Standard Oil Company; Trusts, Industrial -- United States
The producers are poor men, and their resources for this unequal
contest come from the sale of oil, and day by day the price of oil was
depressed until it sank to the neighborhood of half a dollar a barrel.
There has been some recovery since, but still the lowest prices of
many years are being made, and the producers are finding the burden
of their escape very heavy. "It is the honest belief of all oil men,"
says one of them, "that the low price of oil for the year is due to
efforts to make the producer so poor that he cannot carry through his
pipe line." This is the enterprise of the independent refiners as well
as producers. Against these refiners, therefore, the market for refined
oil also is manipulated. Very fantastic have been the operations of the
"unchanging" laws of supply and demand under this manipulation. The
independents found that in the export market of New York, in the spring
of 1894, petroleum, just as it came from the pipe line crude from the
nether earth, was quoted at a higher price a barrel than the same oil
after it had gone through all the processes of refining and was aboard
ship ready for the lamps of Europe or Asia.[307]
To throw another obstacle in the way of the new line, the oil trust in
1893 began again the game of 1878, of refusing to relieve producers of
their oil with its pipe lines. As in 1878, the oil was left to run to
waste. Then, the object was to compel the producers to sell it "always
below the market";[308] now, it was to force them to sign a contract
not to patronize any other pipe lines. Producers who refused to sign
this contract, in order to be free to join the new line when it was
finished, were refused an outlet, and they had to pump their oil on
the ground while appealing to the courts to compel this common carrier
to do its duty.[309] When they applied for a mandamus the combination
receded from its position without waiting for a trial.
This has been a warfare on more than a new competitor; it is an
attempt to suppress improvement and invention. A new idea in oil
transportation, which promises a revolution in the industry, was hit
upon by these independents. This was that pipe lines could be used
to send refined oil long distances to market as well as crude. The
announcement of their plans to do this was met with the ridicule of
those who control the existing pipe lines to the seaboard and do not
wish to see their old-fashioned methods of piping crude oil alone
disturbed. But the independents went on with their idea. They have
proved it practicable. Now, for the first time in the history of the
oil industry, a pipe line transports oil ready for the lamp. Refined
oil is piped from Titusville to Wilkes-barre with no loss of quality.
Many hundred thousand barrels of it have been piped for nearly three
hundred miles, and not a barrel has been rejected by the inspection,
either at New York or its destination abroad. The success of the
experiment proves that it can be piped to New York.
Public-domain text, read in full here on John Shaqi.
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