U.S. oil may rise towards $55.03

U.S. oil may break a resistance at $54.48 per barrel and rise towards the next resistance at $55.03, as a corrective wave cycle from $56.92 has completed. Labelled c, the third wave of the cycle is roughly equal to the first wave labelled a. This equality, along with the bounce from the Oct. 31 low [Read more]

Source: BOE Report

Oil Exchanges Closed By Standard Oil Price Fixing

January 23, 1895 – Oil Exchanges Closed By Standard Oil Price Fixing (found here: https://en.wikipedia.org/wiki/Oil_City,_Pennsylvania) The downtown commercial historic district was added to the National Register of Historic Places in 1997.   Standard Oil had an incredible amount of power in the early years of oil production in the United States, controlling nearly ¾ of the producing and refining potential. This allowed the purchasing agents for Standard Oil to set the price at which they would buy oil from independent producers, rather than the price set by the open market. Oil exchanges were markets that specialized in trading in oil speculations. However, when petroleum giant Standard Oil began to control the overall price for oil, there was little money to be made by investing in oil prices. Standard Oil’s purchasing headquarters in Oil City, Pennsylvania became the third largest financial exchange in the United States behind the New York and San Francisco Stock Exchanges. Ultimately, this caused Standard Oil to run a monopoly on the market, as all other oil exchanges ended up shutting down operations.     January 23, 1991 – Iraqi Army Opens Kuwaiti Pipeline Valves, Causing Huge Oil Spill (found here: https://www.boaterexam.com/blog/2011/03/worst-man-made-seaside-disasters.aspx) The oil slick created by the Gulf War oil spill was over 100 miles wide and 5 inches thick.   While there have been several large oil spills in recent years, the largest in the world was back in 1991. This disaster occured when retreating Iraqi soldiers opened pipeline valves on the Kuwaiti coast in hopes of preventing US Army forces from landing. The total estimated amount of oil spilled varies depending on the source, but it was anywhere between 6 and 11 million barrels. Most of that oil ended up in the Persian Gulf. During the war, several hundred Kuwaiti oil wells caught fire. It would take months before the last of these fires was eventually put out.     January 24, 1895 – Pure Oil Company Created To Counter Standard Oil (found here: http://www.ndroadmaps.com/?page_id=22) Starting in the late 1920’s, it became common practice for gasoline companies to offer free road maps with the locations of their service stations marked.   In 1895, oil producers, refinery owners and pipeline operators all came together to form the Pure Oil Company. They did this in order to effectively compete with Standard Oil who ran the entire exchange industry at the time. Standard made a practice of vertical integration, meaning that they controlled as much of their production and transportation as possible. Standard drilled their own wells, owned their own pipelines and refineries, and even made their own barrels. Pure followed their example, becoming the second vertically integrated oil company in the United States. Pure successfully competed with Standard Oil, selling kerosene in several cities in the eastern United States and breaking their monopoly. Pure Oil would later be bought by Ohio Cities Gas Company, which would adopt the Pure brand.     January 26, 1931 – Size of Huge East Texas Oil Field Revealed (found here: https://www.news-journal.com/news/2017/jul/08/oil-well-discovery-changed-east-texas-forever/) A crowd gathered at the Lathrop No. 1 Well as it neared completion, expecting a gusher similar to the other two that tapped into the East Texas Oil Field.   While the East Texas Oil Field was expected to be quite large, the true size of infamous field was not revealed until the Lathrop No. 1 Well struck oil miles north of two other high producing wells. The wildcat well was the work of Monty Moncrief, an independent operator out of Fort Worth. The Lathrop No. 1 Well produced over 7,000 barrels a day. The two earlier wells that helped create this trifecta were the Daisy Bradford No. 3 Well that had been completed a few months earlier, and the Lou Della Crim No. 1 that was completed only a few days after Christmas, 1930.     January 28, 1969 – Oil Spill Off the Coast of Santa Barbara, CA (found here: https://en.wikipedia.org/wiki/1969_Santa_Barbara_oil_spill) An aerial view of the oil platform and the spill. After the spill was stopped at the surface, the pipe at the seafloor began to leak oil. The bubbling water to the left of the rig is caused by this underwater leak.   An offshore drilling rig ran into a problem while replacing a drill bit causing a devastating spill along the California coastline. The mud used to keep pressure on the well ran low resulting in a blowout that ultimately spilled tens of thousands of barrels of oil. The oil slick spread six miles to the southern California coastline, coating beaches and marine habitats. The spill was controlled after only 12 days, but in that time thousands of birds and marine animals were killed in the process. The spill ultimately helped to turn public opinion against offshore drilling. It also was part of the motivation for creating the Environmental Protection Agency the following year. Continued study of the oil seeps in that area has led to the discovery that the natural pressure forces tons of oil out into the environment every day. Oil drilling and exploitation has relieved some of that pressure, reducing the amount of oil that comes from the seeps.     January 28, 1991 – Oil Rig In Downtown Elk City Becomes Tourist Attraction (found here: http://fans.righands.com/parker-drilling-rig-114/) The 17 story tall Parker Rig No. 114 can be seen just off the historic Route 66.   When it was originally constructed in the 1960s, the Parker Rig No. 114 was one of the largest drilling rigs in the world. It was created to drill deep wells to test nuclear bombs. However, the rig was eventually used by Parker Drilling to dig some of the deepest oil wells using conventional drilling methods, reaching as far as 4 miles down. The rig was used specifically to drill wells into the Anadarko basin, an oil bearing geological formation below Oklahoma and Texas. More recently, it serves to attract tourists to Elk City, Oklahoma.     January 29,  1886 – The Internal Combustion Engine Is Born...

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Church Refuses Permission to Dig In Cemetery

January 18, 1919 – Church Refuses Permission To Drill In Cemetery (found here: https://en.wikipedia.org/wiki/East_Texas_Oil_Field) The East Texas Oil Field is the second largest in the lower 48 states and has produced the most oil since its discovery.   World War I had created a huge demand for oil and gas, and even when the war ended, the demand continued well into the post war-years. Oil wells were being drilled all over North Texas as speculators sought to cash in on the boom. Oil men tried to buy up the rights to every part of the landscape that might contain petroleum. They even attempted to buy the drilling rights for the Merriman Baptist Church’s cemetery for $100 million. Drilling would require the disinterring and moving of corpses and the congregation voted to turn the offer down. They even put up a sign telling the oil men to ‘Respect the Dead.’ The cemetery, which has never been drilled on, still exists near a modern church building.      January 19, 1922 – Geologists Predict US Oil Fields Running Dry (found here: http://liftek.biz/no-rods-or-tubing-required/) Low producing, or stripper, wells are designed to continue pumping oil after the reservoir’s pressure has fallen.   In another of a long line of dire predictions, the U.S. Geological Survey prognosticates oil reserves running dry sometime in 1940, causing widespread panic. There have been many projections that claim an end to the oil supply over the years, and this marked one of the biggest panics insinuted by one of these predictions. However, as oil exploration continued and the true size of petroleum reserves has come to be understood, these “predictions” started holding less weight. The first of these predictions actually took place in 1879, when the state geologist of Pennsylvania predicted that there was only enough oil to produce kerosene for an additional four  years. Other such predictions include the Model T Scare of 1916, a scare during the Cold War and caused major concern at a time where the US believed they needed oil the most.     January 19, 1965 – Robot For Underwater Construction Patented (found here: http://cyberneticzoo.com/tag/howard-l-shatto-jr/) Howard Shatto is standing beside his invention, the Mobot.   In 1965, Howard Shatto patented the first remotely operated underwater robot, a remarkable invention that would go on to change offshore drilling efforts forever. Dubbed the ‘mobot’ — for manipulator operated robot — it was described in the patent as an underwater manipulator with suction support device. Shatto would continue his work on remotely operated robots, becoming a world respected inventor in the field. His work would eventually lead to the modern remotely operated vehicle, or ROV, which are widely used in offshore drilling. Shatto would first work with Shell Oil, helping it to become an early innovator in offshore oil exploration and exploitation. The earliest remotely operated robots were used on land for working in radioactive areas too dangerous for humans. Shatto’s robot was similarly designed to work in areas too dangerous for people, though in this case it was for use in water too deep for divers.     January 20, 1886 – Natural Gas Well Erupts In Ohio (found here: https://www.trover.com/d/9IUj-the-great-karg-gas-well-findlay-ohio) This plaque, located in Findlay, Ohio, commemorates the discovery of the Great Karg Well.   The pressure at the Great Karg natural gas well in Findlay, Ohio builds to more than the technology of the time can handle. The well erupted with natural gas and the flow was initially over 10 million cubic feet in one day. The gas caught fire, becoming a pillar of flame that burned for four months straight. The flaming well served as a tourist attraction for the area. The Great Karg well was not the first natural gas well drilled in Ohio, but it was the largest of its kind. It also launched a boom that brought people and businesses to the areas. In particular, the cheap cost of natural gas caused by the boom attracted glass companies. Bottle makers, a light bulb manufacturer, and a tableware glass maker, among others, all eventually opened factories in Findlay.     January 21, 1865 – Oil Well Torpedo Is Demonstrated For The First Time (found here: https://en.wikipedia.org/wiki/Torpedo_(petroleum)) The torpedo developed by Edward Roberts explodes to force open the cracks in the surrounding rock, fracturing it to improve the flow of oil to the well bore. This was an early form of what has become known as ‘fracking.’   The first ever oil well torpedo was introduced to the world in 1865 when Col. Edward Roberts began his experiments in hopes of improving oil production. This involved using controlled explosions at the bottom of a well, exploding a ‘torpedo,’ or metal casing full of black powder. This first experiment took place deep in a well in Titusville, Pennsylvania. The experiment improved the production of the well, going from just a few barrels a day to over 40. The process became known as ‘shooting a well.’ Later, nitroglycerin became a more common explosive due to its effectiveness, despite its instability. Roberts patented the invention, which used an iron tube filled with an explosive. The well was filled with water to prevent the explosion from escaping up the well. This early form of fracking was used to remove paraffin buildup in the bottom of the well. Earlier methods for dealing with this problem involved pouring dangerous chemicals, such as benzene, into the well to dissolve the buildup.     January 22, 1861 – Kerosene Refined In Pennsylvania For the First Time (found here: https://en.wikipedia.org/wiki/Titusville,_Pennsylvania#/media/File:Titusville,_Pennsylvania,_1896.png) This panoramic view of oil boomtown Titusville, Pennsylvania was drawn by Theodore Fowler, who drew similar views of many boomtowns.   A new type of refinery using multiple stills was built in Pennsylvania near the oil boom town of Titusville. The refinery was designed to produce kerosene, used for illumination at that time. It would produce both the purer white kerosene and a less expensive yellow kerosene. The refinery’s efficiency was low compared to modern versions, one barrel of...

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Is The Era Of U.S. Energy Dominance Already Over?

The global oil industry is a highly lucrative sector that is strongly influenced by geopolitical developments. As the Post-Cold War era comes to an end, a new status quo is arising. The U.S. was once the only player with the capability to significantly influence energy markets around the globe. The country’s military and global alliances proved powerful tools in ...

Source: Oilprice.com

Economic Uncertainty Leaves Oil Markets Paralyzed

The Federal Reserve cut interest rates again this week, but signaled that it may be done cutting for the time being. It was the third interest rate cut this year, which marked an about-face after successive increases over the previous few years. The central bank was forced into monetary easing after the global economy showed signs of slowing down, made ...

Source: Oilprice.com

First ‘Modern’ Rotary Rig Patented

January 2, 1866 – First ‘Modern’ Rotary Rig Patented (found here: https://www.google.com/patents/US51902) Pictured here is a drawing of Peter Sweeney’s patent.   In 1866, Peter Sweeney patented the first rotary drill, a design meant to be an improvement on an earlier creation from Britain’s Robert Beart. This device includes many basic aspects of modern drill rigs that are still used today. Aptly titled Improvement in Rock Drills, this piece included a roller bit and replaceable cutting wheels. The drill head was designed to be turned rapidly so that the cutting wheels cut into the rock and produced a clear hole. The hollow drill-rod, the equivalent of modern drill pipe, allowed steam or water to be piped to the bottom of the hole so that it could be kept clear. The rig was intended for drilling deep holes. Edwin Drake had drilled the first commercial oil well only a few years earlier, but Sweeney’s rock drill improved many of the shortcomings of this original design, and would be used extensively in many oil booms around the country.     January 2, 1882 – Standard Oil Reorganized Into Trust (found here: https://en.wikipedia.org/wiki/Standard_Oil#Monopoly_charges_and_anti-trust_legislation) A share certificate for the Standard Oil Trust.   While the Sherman Antitrust Laws were still a few years off, many states began passing laws against monopolistic companies. In response, John D. Rockefeller reorganized Standard Oil, which owned most of the oil production and transportation companies across the country, into a trust. The Standard Oil Trust in turn owned 40 different affiliate companies, through which it continued to control most of the oil business in the United States. Because of the Standard Oil Trust, and the anti-competitive practices that its control allowed, the idea of a ‘trust’ became associated with monopolies. The trust was eventually broken up by a Supreme Court ruling in 1911.   January 2, 1932 – ‘76’ Brand Gas Was Introduced (found here: https://en.wikipedia.org/wiki/76_(gas_station)) The iconic orange 76 ball was introduced at the 1962 World’s Fair in Seattle.   On January 2nd, 1932 the Union Oil Company unveiled the now infamous ‘76’ brand gasoline at gas stations across the Western United States. The number was a reference both to the octane rating of the gasoline and to the 1776 U.S. Declaration of Independence. The orange ball ‘76’ logo that so many recognize was created for the 1962 World’s Fair in Seattle, Washington. Millions of smaller versions of the logo were given away as car antenna toppers in an effort to create publicity for the gas brand. When ConocoPhillips began rebranding 76 stations in 2005, many of the orange balls were taken down. In response to a ‘Save the 76 Ball’ campaign, they reversed the decision and put up countless new balls in the new brand colors.     January 4, 1948 – New Oil Found In Permian Basin (found here: https://en.wikipedia.org/wiki/Permian_Basin_(North_America)) The Permian Basin is a complex geological formation made up of several component basins and platforms.   In 1948, when an exploratory well hit oil in west Texas, it unveiled the potential for the upcoming Texas oil boom; and lead to a greater focus on the area’s potential for oil production. While there had been many attempts to find oil in the area over the years, this was the first successful wildcat well. Slick-Urschel Oil Company drilled the well southeast of Midland, Texas to a depth of 12,000 ft.. Michael Benedum had drilled the first 10,000 ft in less than six months, but delayed his efforts when he ran into hard rock. With the help of Tom Slick, Jr., a whipstock was used to create a branch off the well in order to reach the oil in the limestone. When oil began flowing, more drillers began to see the potential the Lone Star State would hold.     January 7, 1864 – Oil Discovered At Pithole Creek (found here: https://en.wikipedia.org/wiki/Pithole,_Pennsylvania) A view down Holmden St in Pithole, Pennsylvania. The street was named for Thomas Holmden, the owner of the farmland where oil was discovered, as well as where the town would come to be built.   When Isaiah Frazer and four other investors formed the United States Petroleum Company, they planned to drill exploratory wells throughout Pennsylvania in hopes of striking oil. Just five years earlier, Edwin Drake had drilled the first commercial oil well in nearby Oil Creek and the newly-formed company was looking for similar luck. Frazer and the others had taken a chance on the rougher landscape of Pithole Creek, in hopes of finding their own paying well. The Frazer or United States No. 1 Well struck oil January 7, 1864. According to several reports, the site of the well was chosen using a dowsing rod. When the oil began to flow, this well began fueling the creation of a town that would boil up to a population of 20,000 in less than a year. However, the growing town wouldn’t last long. In just 13 years, the town’s charter would be annulled and Pithole, Pennsylvania was essentially abandoned.     January 7, 1905 – Humble Oilfield Has Outstanding Production (found here: https://howlingpixel.com/wiki/Humble,_Texas) A postcard showing oil being taken by wagon from the oil field in Humble, Texas.   The Beatty No. 2 Well stroke oil in Humble, Texas in 1905, setting a new precedent for the oil production in the United States. C.E. Barrett’s discovery in Harris County would rival the Spindletop oil strike four years earlier, producing over 8,000 barrels a day. Like the Spindletop strike, the discovery of oil in Humble, Texas would lead to a boom in the area. The town’s population would go from under 1,000 to almost 20,000 in just a few months. Humble eventually produced over 15 million barrels of oil in the year of the boom alone. The oil field had a high production for many years, leading to the formation of the Humble Oil and Refining Company in 1911. It would be bought by Standard Oil and eventually become part of ExxonMobil. The Humble...

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55 Gallon Drum Design Patented

December 26, 1905 – 55 Gallon Drum Design Patented (found here: https://en.wikipedia.org/wiki/Nellie_Bly) Nellie Bly, owner of the Ironclad Manufacturing Company and holder of the 55 gallon drum patent, was a journalist before she was an industrialist. Here she is pictured preparing for her round-the-world trip, which she completed in 72 days.   A man by the name of Henry Wehrhan, who was working for Ironclad Manufacturing Company, applied for a couseveral patents of steel barrels, replacing the then industry-standard wooden barrels of the day. These patents would eventually go on to be developed into the modern 55-gallon steel drum. Ironclad Manufacturing was owned by the famous Nellie Bly, an independent woman who had worked as a journalist for many years. Ten years earlier she had married the founder of Ironclad, Robert Seaman. And when Seaman passed away in 1904, he left Bly as president of the company, making her the official holder of the 55 gallon drum patent. (found here: http://www.skolnik.com/blog/nellie-bly-woman-of-steel-3/) The patent for the steel barrel Wehrhan designed.   The steel drum Wehrhan designed was simple to manufacture and included flanged hoops for additional strength, bringing a great deal of promise to Bly’s newly acquired company. Unfortunately, the company would go bankrupt due to embezzlement by a factory manager and Bly would ultimately return to journalism.     December 28, 1930 – Well Reveals True Size of East Texas Oilfield (found here: https://www.news-journal.com/news/2017/jul/08/oil-well-discovery-changed-east-texas-forever/) The Lathrop No. 1 Well, seen here, was drilled 15 miles north of the Lou Della Crim No. 1 Well, confirming that the East Texas oilfield was larger than most had believed.   When J. Malcolm Crim completed the Lou Della Crim No. 1 Well, which he named for his mother, he had no idea that the well would unveil more than just oil. The resulting gusher proved that the East Texas oilfield is much larger than was previously believed. Geologists had claimed that it was unlikely that anyone would find oil in the area around Kilgore, Texas. However, Malcolm Crim still drilled on the land belonging to his mother, ignoring their predictions. There are a few myths surrounding his motivations for drilling, but no matter what the reason, he proved to be correct when he struck oil. The well produced tens of thousands of barrels a day, and confirmed the massive size of the East Texas oilfield. Other successful wells would continue to showcase the size of the oilfield, which would eventually be determined to be nearly 500 square miles in size.     December 30, 1854 – First Petroleum Company In US Opens (found here: http://www.enopetroleum.com/earlyoilpennsylvania.html) A stock certificate for the Pennsylvania Rock Oil Company.   In 1854, George Bissell and six other men formed the Pennsylvania Rock Oil Company, the first business organized to drill for and sell oil in the United States. Openedin Albany, New York, the company initially had difficulty attracting investors. The brand underwent a massive reorganization, before the original owners lost control of the business in the stock panic of 1857. It was eventually purchased by Robert Townsend who incorporated it as part of the Seneca Oil Company. It was Townsend and Seneca Oil that hired Edwin L. Drake whose oil strike in Venango County Pennsylvania would become known as the first commercial oil well in the United States.     December 31, 1954 – 4-Mile Deep Dry Hole Sets Depth Record (found here: https://www.liveauctioneers.com/item/17188678_the-ohio-oil-company-marathon-sign) The Ohio Oil Company would later buy Transcontinental Oil, including the Marathon brand, and its distinctive Greek runner logo.   In 1954, the Ohio Oil Company drilled a hole that would go on to set a depth record. The hole was located in Kern County, California, in the San Joaquin Valley, and was over 4 miles deep. Technological advances allowed drilling to that depth, though the technology of the time did not prove quite up to the challenge. The drill became stuck at the bottom and had to be fished out of the hole. Despite the depth of the hole, no oil was discovered. A well that was nearly as deep, also located in Kern County, was eventually drilled by the Richfield Oil Corporation. However, it was short of the record by about 4,000 ft. Wells of that depth cost over half a million dollars to complete, yet despite the cost, over 600 wells were drilled in California that year alone.

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