Rockefeller and Co. turned oil into local gold
The ancients used petroleum in all sorts of lotions and potions.
This goopy essence of fossil anointed kings, painted warriors, coated mummies, paved streets, sealed arks, burned enemies and lit lamps against the dark.
Wells and pipelines were ancient, too. The early Chinese drilled oil 100 feet down and shipped it through bamboo.
Little changed until the mid- 1800s, when scientists developed kerosene, a distillate replacing scarce whale oil in lamps. Petroleum became a staple.
Late in the century, horseless carriages started using a once- unwanted byproduct called gasoline. Petroleum became an essential. A scepter of power. A sword over our heads.
Today, from asphalt to aspirin, from polyesters to plastics, the world runs on oil. Conserves it. Guzzles it. Speculates on it. Fights over it. Counts on it.
Oil is the world's biggest business and one of its most combustible. It has drawn all sorts of eccentrics, from H.L. "Boy" Hunt, gambling host and bigamist, to Armand Hammer, Kremlin confidante and bull semen salesman. It has fueled inflation, recession, pollution, scandal and war.
Early on, oil made modern Cleveland.
"It always amazes me how much of the wealth of the city still goes back to Rockefeller's days," Alton W. Whitehouse Jr., longtime head of Sohio, says about John D.
Rockefeller, the spindly, pious son of a "snake oil" salesman, built the world's biggest business here: Standard Oil. Payne, Flagler, Harkness, Squire, Stone, Mather, Hanna and Eaton were just a few of the locals with fortunes linked to Rockefeller's.
Oil also indirectly enriched Akron, which made tires for gas- gulping cars.
Now, the oil business has virtually vanished here, but thriving spinoffs import the stuff for everything from paints to polymers. Cultural and charitable spinoffs are thriving, too, from Severance Hall (built by a Standard man) to the Cleveland Foundation (modeled on Rockefeller's charities).
The roots of the oil oligarchy date to 1859 in Titusville, Pa., about 100 miles east of Cleveland. After struggling for two years, "Colonel" Edwin Drake, a sometime train conductor, raised buckets of petroleum from 70 feet below the banks of filmy Oil Creek.
Soon, a boom of black gold rivaled California's rush. "Sodden Gomorrah" teemed with wildcatters, swindlers and prostitutes.
Oil befouled Cleveland, where some 20 refineries sprang up. No matter. Most people believed not in preserving nature's gifts but milking them.
Rockefeller, a rising wholesaler barely out of his teens, visited the oil region and slipped into a pit. "You have got me into the oil business," he said calmly, "head and ears."
Shunning the unpredictability of drilling, Rockefeller opened a refinery in 1863 along the Cuyahoga River. In what local historian Christopher Eiben calls "a brilliant stroke of corporate backscratching," Rockefeller sold shares to bankers who lent him millions and railroaders who gave him great freight deals, including rebates on rivals' shipments.
The company that incorporated in 1870 as Standard Oil Co. fattened friends and starved foes, squeezing supplies and pipelines. The result was the first global business and a daunting monopoly. Rockefeller's "missionaries of light" sold at least 90 percent of the world's oil.
For decades, Standard dodged prosecutors, politicians and the first muckrakers. It reorganized as a trust for 10 years, then a holding company. It was partly blamed for a deadly railroad strike in 1877. It also inspired the first federal laws broadly governing commerce and transportation.
In 1885, drillers found oil near Lima in northwest Ohio. Standard finally took a multimillion- dollar chance on drilling. Soon, the region led the world in crude, spawning today's Marathon Oil, and Standard controlled oil from the well to the wick.
Standard saw outlets everywhere. It sold over 300 refining byproducts for everything from the fast-growing nation's roads and gears to Vaseline and a Cleveland novelty: commercial chewing gum.
Cleveland swelled, but not fast enough. Standard and its president officially moved to Manhattan in the 1880s. Its consolidations swelled cities, but Rockefeller influenced urban sprawl, building bucolic estates outside Cleveland and New York.
In 1911, the U.S. Supreme Court tried to boost competition by splitting Standard into 34 companies, including Standard of Ohio (later Sohio). The companies thrived apart but were already losing market dominance to rivals working far-flung sites from Texas to Russia to Venezuela and, of course, the Middle East. The Third World's wells were exploited by Westerners, sowing resentment and nationalism.
Technology both hurt and helped. Light bulbs eclipsed kerosene, but automobiles, airplanes and modernized ships boosted oil over coal as the world's top source of power.
In the 20th century, the world wars were fueled by oil and fought partly over prized oilfields. Afterward, U.S. leaders billed the new interstate highway system as a defense measure, though it also multiplied suburbs, gas sales and pollution.
The U.S. plunged into Middle East politics, toppling Iran's premier and his nationalized oil system. The Organization of Petroleum Exporting Countries, formed in 1960, began to wreak economic and political revenge.
In 1969, flames from oily Cuyahoga River debris came to symbolize pollution. Soon, oil embargoes sent U.S. prices soaring. Lawmakers pressed carmakers to boost mileage.
Needing a U.S. base to exploit Alaskan wells, British Petroleum took partial control of Sohio in 1970 and total control in 1987. A dozen years later, it merged Sohio with Amoco (the former Standard of Indiana) and closed oil's last bastion in Cleveland, the industry's onetime capital. Then Standard's two biggest scions, Exxon and Mobil, merged in 1999.
In recent years, oil has been fingered for acid rain, global warming and more. But it's more crucial than ever to global economics and politics, from Iraqi oilfields to Alaskan preserves.
At home, the ex-urbs are swelling, but mass transit is wilting. The United States is united mostly by cars rumbling from pump to pump.
To reach this Plain Dealer reporter:
[email protected], 216-999-4187
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