The Prize: The Epic Quest for Oil, Money, and Power

by Daniel Yergin

The oil industry had confronted chronic imbalances of supply and demand since its very first days in the hills of western Pennsylvania, and it had responded with a drive toward consolidation and integration to assure and regulate supplies, gain access to markets, stabilize prices, and protect and expand profits. Consolidation had meant the acquisition of competitors and complementary companies. Integration meant the yoking together of some or all segments of the industry, upstream and downstream, from exploration and production at the wellhead to refining and retail sales. The great Standard Oil Trust had skillfully managed to integrate in both directions, only to be attacked and dissolved by the Supreme Court. But in the uncertain supply and demand climate of the 1920s, the same old strategies among the once-cozy Standard Oil successor companies, as well as among other companies, reemerged, turning them into vigorous competitors. There was also a new dimension in the competition. Oil companies were becoming marketers, for the first time selling automotive fuel at retail, directly to motorists, at the brand-name stations that were springing up all across the American landscape. Oil wars were not only being fought for supply and markets in foreign lands, but were also erupting in an equally fierce struggle for markets on the main streets of America. And, in its efforts to court consumers, as well as in its inherent propensity toward consolidation and integration, the Americ...