The Oil Industry

Asphalt

• Thick crude oil was used by Native Americans– Used to waterproof boats and baskets– Also used as a base for medications

• Oil seeped to the surface of the ground.

• It was mainly used as grease for early wagon wheels

• 1840’s – Kerosene oil was a petroleum used for lighting oil lamps. – One problem: started fires that burned for a

long time.

1859

• Edwin Drake drilled the 1st oil well in Titusville, Penn.

• Drilling quickly spread to Ohio and West Virginia

• By 1856, 2 million barrels were produced

• 40 gallons=1 barrel

No Oil

• Dry hole = no oil

• First attempts to drill in TX were unsuccessful

• An oil field in East TX claimed

to have 40 mediocre wells.

Early 1900’s

• A new use for petroleum…the automobile

• The automobile used gasoline, a by product of petroleum.

• World War I and farming equipment increased the demand for oil!

Spindletop

• January 1910

• Gusher – 500,000 barrels of oil in 6 days until it was capped.

• It was a salt dome full of crude oil and resulted in an oil

• Frantic race to discover oil in Texas!

• Spindletop encouraged oil exploration in other states and in other parts of TX.

• Oil Production quadrupled– Too much oil dropped the price to 5 cents a

barrel– Too much waste

• Need to regulate/restrict production

Railroad Commission

• James Hogg – governor of TX– Creates the Railroad Commission

• Limited the number of wells in an area• Wells had to be separated by certain distances• Big companies followed the rules• Little companies did not• Penalties were created for

breaking the law

Assignment

• Page 430 – Chapter 20 Assessment– Terms & Names– Review Questions