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Today in HistoryâSeptember 29: John D. Rockefeller Becomes the World's First Billionaire
Top Questions
What is Standard Oil?
Standard Oil (in full, Standard Oil Company and Trust) was an American company and corporate trust built by John D. Rockefeller and associates. Incorporated in Ohio in 1870, it expanded through acquisitions, mergers, and favorable railroad rebates. In 1882, Standard Oil and its affiliated companies were combined into the Standard Oil Trust. By then, it controlled the refining of 90% to 95% of alloil produced in the United States.
 When was Standard Oil founded?
Standard Oil Company was incorporated in Ohio in 1870, but the companyâs origins date to 1863, when John D. Rockefeller joined Maurice B. Clark and Samuel Andrews in a Cleveland, Ohio, oil-refining business. Rockefeller bought out Clark in 1865, and Henry M. Flagler became a partner in the venture in 1867. The firm of Rockefeller, Andrews, and Flagler was operating the largest refineries in Cleveland when Standard Oil Company was incorporated.
Why was Standard Oil considered a monopoly?
Standard Oil grew by eliminating competitors, merging with other firms, and obtaining favorable railroad rebates. By 1880, it controlled the refining of 90% to 95% of all oil produced in the United States. Critics argued that this concentration gave Standard Oil excessive economic power, eventually making the company a major target of federal antitrust enforcement.
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The former Standard Oil Building, Lower Manhattan, New York City, constructed in 1921â28 atop an original building of 1884â85; designed by Thomas Hastings. It was the headquarters of the Standard Oil Trust and successor companies until 1956.
Library of Congress, Washington, D.C.
Standard Oil was an American company and corporate trust that from 1870 to 1911 was the industrial empire of John D. Rockefeller of the famed Rockefeller family, controlling almost all oil production, processing, marketing, and transportation in the United States.
The rise of Standard Oil
The companyâs origins date to 1863, when Rockefeller joined Maurice B. Clark and Samuel Andrews in a Cleveland, Ohio, oil-refining business. In 1865 Rockefeller bought out Clark, and two years later he invited Henry M. Flagler to join as a partner in the venture. By 1870 the firm of Rockefeller, Andrews, and Flagler was operating the largest refineries in Cleveland, and these and related facilities became the property of the new Standard Oil Company, incorporated in Ohio in 1870. By 1880, through elimination of competitors, mergers with other firms, and use of favorable railroad rebates, it controlled the refining of 90 to 95 percent of all oil produced in the United States.
Trace the history of Standard Oil.
EncyclopĂŠdia Britannica, Inc.
The Standard Oil Trust and antitrust
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John D. Rockefeller.
Library of Congress, Washington, D.C.
In 1882 the Standard Oil Company and affiliated companies that were engaged in producing, refining, and marketing oil were combined in the Standard Oil Trust, created by the Standard Oil Trust Agreement signed by nine trustees, including Rockefeller. By the agreement, companies could be purchased, created, dissolved, merged, or divided; eventually, the trustees governed some 40 corporations, of which 14 were wholly owned.
Founded in 1882, Standard Oil of New Jersey was one component of the trust; by design the Standard Oil Trust embraced a maze of legal structures, which made its workings virtually impervious to public investigation and understanding. As Ida Tarbell wrote in her History of the Standard Oil Company (1904), âYou could argue its existence from its effects, but you could not prove it.â In 1892 the Ohio Supreme Court ordered the trust dissolved, but it effectively continued to operate from headquarters in New York City.
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One of Standard Oil Companyâs first tank wagons. Credit: BettmannâBettmann/Getty Images
In 1899, however, the company renamed its New Jersey firm Standard Oil Company (New Jersey) and incorporated it as a holding company. All assets and interests formerly grouped in the trust were transferred to the New Jersey company.
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Workers rioting during the Standard Oil strike, Bayonne, New Jersey, 1915.
Library of Congress, Washington, D.C.
Although consolidation did advance the large-scale production and distribution of oil products, many critics believed that the resulting concentration of economic power was becoming excessive. In 1906 the U.S. government brought suit against Standard Oil Company (New Jersey) under the Sherman Antitrust Act of 1890; in 1911 the New Jersey company was ordered to divest itself of its major holdingsâ33 companies in all.
The breakup and Standard Oilâs legacy
In 1911, after dissolution of the Standard Oil empire, eight companies retained âStandard Oilâ in their names, but by the late 20th century the name had almost passed into history. In 1931 Standard Oil Company of New York merged with Vacuum Oil Company (another trust company) to form Socony-Vacuum, which in 1966 became Mobil Oil Corporation. Standard Oil (Indiana) absorbed Standard Oil of Nebraska in 1939 and Standard Oil of Kansas in 1948 and was renamed Amoco Corporation in 1985.
Standard Oil of California acquired Standard Oil of Kentucky in 1961 and was renamed Chevron Corporation in 1984. Standard Oil Company (New Jersey) changed its name to Exxon Corporation in 1972. British Petroleum Company PLC completed the purchase of Standard Oil Company (Ohio) in 1987, and in 1998 British Petroleum (renamed BP) merged with Amoco. Exxon and Mobil merged in 1999, and Chevron merged with Texaco in 2001.
Other companies that once were part of the trust included Atlantic Richfield Company (acquired by BP in 2000), Buckeye Pipe Line Company (Ohio), Chesebrough-Pondâs Inc. (now part of Unilever), Pennzoil Company (acquired by Shell PLC in 2002), and Union Tank Car Company (New Jersey). More than a century after the breakup, Standard Oilâs legacy remains embedded in the structure of the global energy sector.
