This Week July 10 to July 16
July 11, 2008 – World Oil Prices hit Historic High
U.S. “light sweet crude” rises to $147.27 a barrel, before dropping back to $145.08. Prices on the New York Mercantile Exchange peaked at $145.29 a barrel eight days earlier. As supply fears subside (despite speculation and concern about Iran and new demand from China and India competing for world oil supplies) oil prices fall to $36.51 a barrel on January 16, 2009.
Today’s oil price is about $85 per barrel. The United States imports about 45 percent its oil, according to the U.S. Energy Information Administration (EIA). Dependence on foreign petroleum has declined since peaking in 2005.
Recent electric power data show that, for the first time since EIA began collecting the data, “generation from natural gas-fired plants is virtually equal to generation from coal-fired plants, with each fuel providing 32 percent of total generation.”
July 12, 1934 – The Start of “Clark Super 100″
Clark begins building a network of filling stations focused on premium gasoline only – delivering “Super 100 Premium Gasoline.”
Clark’s marketing strategy is to omit many of the common services such as maintenance, engine repair, and tire changing. Sales reach $21.1 million in 1949, notes the Harvard Business School Baker Library.
In 1953 Clark operates 158 service stations in the Midwest under the brand name “Clark Super 100.” Sales rise to $38.2 million by 1954 from 326 stations. In September 1967 Clark purchases a 31,000 barrel per day refinery at Wood River, Illinois.
By 1970, his company operates almost 1,500 gas stations and two refineries with combined capacity of almost 100,000 barrels a day.
In 1981, the Clark family will sell their company holdings – which began with Emory T. Clark’s $14 purchase – to Missouri-based Apex Oil for $483 million.
The modern Wood River Manufacturing Complex remains a leading refinery serving the Midwest market, notes the Wood River Refinery History Museum in Roxana, Illinois, where exhibits trace the refinery’s history from its beginning in 1917.
July 13, 1921 – Searching for Improved Mileage
“More Miles per Gallon of Petrol” is published by Purdue University professor Otto Carter Berry in the journal Chemical and Metallurgical Engineering. Improved mileage is needed “in view of the shortage of petroleum which is anticipated in the next fifteen years,” notes Berry.
He offers a “means of economizing fuel consumption in motor cars” – including improved spark timing to achieve efficient combustion. His oil shortage prediction will be dispelled by a series of discoveries leading up to the giant East Texas oilfield strike in October 1930. Visit the East Texas Oil Museum in Kilgore.
July 14, 1863 – A Diamond “Tool for Boring Rock”
French tunnel engineer Rodolphe Leschot patents his “Tool for Boring Rock” – a ring of industrial-grade diamonds fixed on the end of a tubular drill rod and designed to cut a cylindrical core. Water pumped through the drill rod washes away cuttings and cools the bit.
Leschot’s system (patent no. 39235) proves successful in drilling blast holes for tunneling Mount Cenis on the France-Italy border. By 1865, its use in oil well drilling is being examined in the oil regions of western Pennsylvania. Practical applications for the revolutionary design will take many decades.
“It is not known if there is any connection between the 1865 experimental diamond core drilling in the Pennsylvania oil region and the Leschot blast hole drilling in France in 1863,” notes oil historian Samuel T. Pees. Learn more about the oil region at the Drake Well Museum in Titusville.
July 14, 1891 – Rockefeller expands Oil Tank Car Empire
John D. Rockefeller incorporates Union Tank Line Company in New Jersey and transfers his fleet of several thousand oil tank cars to the Standard Oil Trust. The new company – avoiding state anti-trust litigation – includes a fleet of tank cars from Standard’s purchase of J. J. Vandergrift’s Star Tank Line in 1873.
Rockefeller systematically acquires other oil tank cars and by 1878 controls all but 200 of America’s 3,200 existing tank cars. By 1904, his fleet has grown to 10,000. Union Tank Line Company ships only Standard Oil products until 1911, when a U. S. Supreme Court decision mandates dissolution of his trust.
The newly independent company changes its name to Union Tank Car Company – and its rolling stock “reporting mark” remains UTL or UTLX to this day. Now as a part of the Marmon Group Inc. and Canadian partner Procor Ltd., the company is North America’s leading manufacturer of railroad tank cars for the chemical, petrochemical and food industries. It manages a U. S. fleet of 61,000 cars.
July 16, 1926 – Start of the Greater Seminole Area Oil Boom
A discovery well near Seminole, Oklahoma, reveals the potential of an oil producing formation, the Wilcox sand – and launches a drilling boom that will make Oklahoma one of today’s leading producing states. The Fixico No. 1 well penetrates the Wilcox sand at 4,073 feet.
By 1935, the oilfield around Seminole will become the largest supplier of oil in the world. More than 60 petroleum reservoirs are found in 1,300 square miles of east-central Oklahoma – and six are giants that produce more than million barrels of oil each.
The greater Seminole area - several 1920s Oklahoma oilfields – will swing the United States’ oil reserves from scarcity to surplus. Flowing at 6,120 barrels of oil a day from 4,073 feet, the Fixico well is among five Seminole-area oil reservoirs discovered by 1927.
Oil discoveries bring 20,000 oilfield workers to Seminole County, creating several boom towns. Prosperity transforms life in many central Oklahoma communities, according to historian and author Louise Welsh. Prior to the oil boom period, the area had been one of the poorest economic areas in Oklahoma.
“It was quite natural that, under such stress, the prospect of finding oil should occasion both excitement and hope, since the prospect of leasing his land might provide the necessary funds with which the hard-pressed farmer could pay off his mortgage,” Welsh says in A History of the Greater Seminole Oil Field.
When massive production gluts oil markets and results in a price collapse to as low as 15 cents per barrel, many oilfields are placed under state control. “Thus, the conservation movement, as far as the oil industry is concerned, started in Oklahoma and largely in the greater Seminole areas,” Welsh concludes.
At its height, the Seminole City oilfield alone will account for 2.6 percent of the world’s oil production. Read more in “Greater Seminole Oil Boom.”
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