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By 1890, Standard Oil controlled over 90% of the refined oil flows in the United States. Though conspicuous, it made John D. Rockefeller the wealthiest man in the world. It was at this time that Standard Oil of Ohio moved its headquarters out of Cleveland and into its permanent headquarters at 26 Broadway in New York City.
Concurrently, the trustees of Standard Oil of Ohio chartered the Standard Oil Company of New Jersey in order to take advantages of New Jersey's more lenient corporate stock ownership laws. Standard Oil of New Jersey eventually became one of many important trusts that dominated key markets, such as steel and the railroad. Also in 1890, Congress passed the Sherman Antitrust Act -- the source of all American anti-monopoly laws. The law forbade every contract, scheme, deal, or conspiracy to restrain trade, though the phrase "restrain trade" remains open to interpretation. Standard Oil Trust quickly attracted attention from antitrust authorities and the Ohio Attorney General filed and won an antitrust suit in 1892.
Standard Oil's quasi-monopolistic position had been established through aggressively anti-competitive business practices, including a systematic program of purchasing competitors or running them out of business by any means necessary, legal or otherwise. Most controversially of all, Rockefeller secretly arranged illegal volume-discount transportation deals with the railroad companies, in order to ensure that it could substantially undercut its smaller competitors' prices. Rockefeller also used his enormous influence with the railroad companies to prevent his competitors from gaining access to other rail services.
In one of the most infamous examples of Standard's monopolistic practices, a rival oil association decided to build an oil pipeline, hoping to overcome the virtual boycott imposed on Standard's competitors. In response, the railroad company (at Rockefeller's direction) denied the consortium permission to run the pipeline across railway land, forcing consortium staff to laboriously decant the oil into barrels, carry them over the railway crossing in carts, and then pump the oil manually back into the pipeline on the other side. When he learned of this tactic, Rockefeller then instructed the railway company to park empty rail cars across the line, thereby preventing the carts from crossing the line. Actual photographs of this incident are included in the PBS TV adaptation of Daniel Yergin's award-winning history of the oil industry, The Prize.
Standard's monopolistic actions and secret transport deals helped its kerosene to drop in price from 58 to 26 cents between 1865 and 1870. Competitors might not have appreciated the company's business practices, but consumers appreciated the drop in prices. Standard Oil, being formed well before the discovery of the Spindletop oil field and a demand for oil other than for heat and light, was well placed to control the growth of the oil business. The company was perceived to own and control all aspects of the trade. Oil could not leave the oil field unless Standard Oil agreed to move it: the "posted price" for oil was the price that Standard Oil agents printed on flyers that were nailed to posts in oil producing areas, and producers were in a take-it-or-leave-it position.
Then came Ida M. Tarbell, an American author and journalist, and one of the original "muckrakers". Her father was an oil producer whose business had failed due to Rockefeller's business dealings. Following extensive interviews with a sympathetic senior executive of Standard Oil, Henry H. Rogers, Tarbell's investigations of Standard Oil fuelled growing public attacks on Standard Oil and on trusts in general. Her work was first published in nineteen parts in McClure's magazine, from November 1902 to October 1904, in which year it was published in book form as The History of the Standard Oil Company. Tarbell's investigation is seen as hastening the breakup of Standard Oil, in 1911 and her report for McClure's is now regarded as one of the cornerstone works of investigative journalism.
Other related archives1830, 1865, 1870, 1874, 1882, 1890, 1891, 1892, 1902, 1904, 1911, 1930s, American, Amoco, Arco,
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