Standard Oil Company
In 1862, John D. Rockefeller, a resident of Cleveland Ohio, joined with two partners to establish an oil-refining company. The men purchased oil wells in Titusville, Pennsylvania, and constructed a well near Cleveland. In 1865, Rockefeller bought out one of the partners' interest in the company, creating Rockefeller & Andrews Oil Company. In this year alone, the business earned approximately 200,000 dollars.
While Rockefeller reaped extensive wealth in 1865, the oil industry was just beginning to grow. Most people only used oil for lighting. The market was limited. Prices fluctuated dramatically, as oil production waxed and waned during this period. To try and stabilize oil prices Rockefeller and Samuel Andrews, his partner, approached O.H. Payne, owner of the largest oil refinery in Cleveland. They proposed that the three men unite their companies together. By having a single oil company operating in northeastern Ohio, this company could hopefully fix prices and avoid the tremendous swings as production sometimes increased or dwindled. The company organizers convinced numerous other Cleveland firms to join with them. In other cases, they bought out the companies or drove them out of business by selling their oil for a much cheaper price than their competitors could. In 1870, Rockefeller united these companies together as the Standard Oil Company.
During the 1870s and 1880s, Rockefeller sought to expand Standard Oil's influence. The company began to purchase or drive out of business oil refiners across the United States. By 1878, Standard Oil purportedly controlled ninety percent of the oil refineries in the United States. In 1881, the Standard Oil Company became known as the Standard Oil Trust. In essence, the Standard Oil Company created various companies across the United States that were purportedly their own entities. In reality, Rockefeller directed all of these businesses.
During the 1880s and 1890s, Rockefeller came under attack from the federal government for having created a virtual monopoly over the oil industry. In 1890, John Sherman, a senator from Ohio, proposed an anti-trust act, authorizing the federal government to break up any businesses that prohibited competition. The Standard Oil Trust effectively eliminated competition. In 1892, Ohio's attorney general filed suit against Rockefeller and his company. While Ohio won the case, Standard Oil appealed the decision. In 1911, the United States Supreme Court eventually ruled in this case that Standard Oil was a trust and had to cease to exist. The company then splintered into numerous subsidiaries. In theory, these companies were no longer owned by a single person or operated by a single board of directors, but it appears that they still operated in conjunction with each other. Among these various companies were Standard Oil of Ohio, Standard Oil of Indiana, Standard Oil of New York, Standard Oil of New Jersey, Standard Oil of California, Standard Oil of Kentucky, Standard Oil of Iowa, Standard Oil of Minnesota, Standard Oil of Illinois, Standard Oil of Kansas, Standard Oil of Missouri, Standard Oil of Nebraska, and Standard Oil of Louisiana. Other companies used the Standard Oil name to profit off of the company's reputation, but these organizations were never part of the company formerly controlled by Rockefeller.
The Standard Oil Company of Ohio was the original company that Rockefeller established in 1862. In 1911, following the Supreme Court ruling, the company became known as Standard Oil of Ohio or SOHIO. The company, in effect, ceased to exist after being purchased by British Petroleum (BP) in 1970, although BP continued to sell gasoline under the SOHIO brand name until 1991.