The oil sheiks of Virginia assembled here at sunset in a cafe that specializes in pork tenderloin and homemade pies.The moguls, all three of them, sat around a steel-legged table, bummed cigarettes from each other and talked about how their fortunes are growing.

"These oil fields around here are going to make history," said Robert F. Spear, the senior oil tycoon and the only one wearing a cowboy hat. "But it'll take two things. I'll take people who got guts or somebody who can outtalk people who don't have guts."

The little speech seemed to inspire the senior oil magnate's colleagues. And, as the late afternoon sun here in this isolated southwest corner of Virginia cut shadows across the Cumberland Mountains outside, the oilmen inside the Boone's Trail Drive-In Cafe smiled and spoke of gushers.

They are talking big and thinking big around Virginia's only oil fields these days because the price of the yellow-green crude that comes out of the ground here has more than doubled in price in the last year, from $15 a barrel to $32.50.

OPEC price increases, the cutoff of Iranian oil and federal regulations that place no restrictions on the price of the "stripper production" in these Appalachian hills have conspired to put smiles on the faces of the three men who dominate this area's tiny oil industry.

Minuscule might be a more accurate description. Virginia estimates there are about 300,000 barrels of oil that can be taken out of Lee County, about 400 miles southwest of Washington near the Tennessee and Kentucky borders. That's a pittance to the large multinational oil companies interested in long-term, high-profit product, says William W. Kelly, a state geologist.

For purpose of comparison, Saudi Arabia has estimated oil reserves of 150 billion barrels, the entire United States has 50 billion barrels and Virginia has .0003 billion barrels.

These statistics and the pessimism of some state oil experts, however, are not discouraging to the oil men here.

One of the Virginia oil sheiks, businessman, A. E. (Gus) Sorensen from nearby Blountville, Tenn., had a gusher come in Oct. 1 in the nearby Ben Hur fields. Following the niggardly nature of oil wells around here, the gusher sprayed 300 barrels of oil on the ground the day it came in and within a month was producing only 10 barrels of oil a day.

But Sorenson, who's expecting to make about $120,000 a year from that one hole in the ground, says the future is bright. "There's supposed to be a lot of big oil around here," he said.

Here in the Powell Valley, which Daniel Boone once used as a shortcut to Kentucky, there's been talk of an oil boom since 1922. That was when a farmer in nearby Possum Hollow pulled a tree stump out of the ground and saw black goo come oozing out.

It took more than 24 years, however, before oil was found in Lee County in commercial quantities. In 1946, a harddriving oil man from Texas showed up in southwest Virginia representing the Rouge Oil Co. of Baton Rouge, La. iThe Texan's name was Robert F. Spear -- the same man who's making speeches this week in the Boone's Trail cafe here.

Spear, now 78, is a large, barrel-chested man with long white sideburns, bifocals, cowboy boots and a brown cowboy hat. Since he fell in love with the solitude of the Appalachian hills, Spear has been the oil king of Virginia.

Admittedly, his kingdom at the present isn't all that much. There are only five oil wells pumping in Virginia. Spear owns four of them and his wife, Patty, has part interest in the fifth. On a good day, Spear's wells produce maybe 11 barrels of oil.

Back in the 1940s, Spear dug the wells that started the first boom. "I came here and done awful good to start with: 38 wells and three dry holes," Spear said.

Three major oil companies and a number of independents were attracted to Virginia by his success. More than 500 oil men invaded the county. Production soared to more than 60,000 barrels of oil a day.

"It was big, I'm telling you," said Alan Giles, a local truck driver who was 12 years old here during the boom. "I mean they was ahaulin' barrels and barrels out of here every day. My mother made me stay away from the oil men because she was afraid I'd see them smokin' and cussin'."

The oil men pulled out in the early 1950s when the easily accessible oil was gone and the price of a barrel of crude had plummeted from more than $4 to about $1.

Spear, too, moved on. The Houston-born oil man, who'd gone to work in the Texas oil fields when he was 14, took off for Cuba in search of crude. He spent the next 15 years flying around the continent looking for "good producin' wells." In 1965, Spear retired here to look for some peace of mind -- and a little more oil.

"I like the country here to live in," said Spear, speaking of this rural county with 446 square miles of timber and tobacco fields and only about 20,000 people. "It's not blowing and going here like in Houston. I got tired of the mad rush in all those airplanes. But I came back principally to drill wells in this valley."

As he sat in the Boone's Trail Cafe this week, Spear said he believes there's millions of dollars to be made by drilling deep in the limestone here. He's got other people to believe also. Sorensen, the Tennessee man who had the gusher in October, has leased mineral rights to more than 8,000 acres here. Phillips Petroleum Co. -- one of many oil companies that have expressed interest here -- has the mineral rights to more than 89,000 acres in the region.

Finding oil in this area is an enormously frustrating undertaking, according to the Virginia Division of Mines and Quarries.

"It is a hit-or-miss deal here," said Kelly, the geologist who for six years enforced state oil drilling laws in this area. The oil is contained in cracks that meander through layers of limestone about 2,000 feet below the ground. Kelly said it is extremely difficult to figure out where cracks run. For example, the October gusher was drilled just 30 feet from a well that hasn't produced a drop of oil.

Even when a driller hits oil, it doesn't mean he'll produce oil for very long, Kelly said. "You don't have big voids full of oil like they got out in the West or in the Middle East. Production here is generally pretty small and short-lived."

Grover Witt, the third oil baronet in attendance at the Boone's Trail Cafe this week, said he still figures on making money despite his recent drilling failures.

Witt and his partner Danny Moore have been drilling in the nearby Rose Hill oil field for 2 1/2 years and have come up with two dry holes and one well that produced oil -- for one day. That gusher produced 750 barrels in 24 hours and went dry. "It went zonk and that was it," said Witt.

Oil men here say they are willing to wait for a good well because it does not take a whole lot of oil at $32.50 a barrel to become rich. Witt and Spear have easily found investors willing to pay part of the $10-a-foot cost of drilling in return for a piece of the possible profits.

With his four wells pumping slow but steady every day, Spear said he should make about $40,000 profit this year.

This week, on a drive through his oil fields, Spear parked beside an oil well that he drilled in 1946. It is named W. S. Riley No. 2 (after the farmer who owned the land then) and it still produces five barrels of oil a day, or about $60,000 worth of crude a year. Spear said when he drilled the well it produced 300 barrels a day.

Now, the kind of Virginia oil is planning to drill another well about 50 yards away. Spear said he knows precisely where the oil is.

"If we can just get a well that pumps like Riley No. 2, ha, ha, ha. That's a considerable amount of money nowadays, isn't it?"