Founded by John D. Rockefeller (1839-1937) in 1870, The Exxon Corporation developed from another oil company giant, which is Standard Oil Company. Reported monopoly of Standard oil over the oil industry in the early twentieth century proceeded to succession of criticism from politicians and even journalists. However, Exxon still remains the third largest company in the United States and reportedly to be the seventh largest in the world. (Fortune, April 28, 1997). It was Rockefeller anticipated a big potential of refining Pennsylvania crude oil.
However internal combustion engines were not yet fully developed a substitute can be used which is kerosene to fuel lanterns. When Standard Oil was formed, it integrated all of the docks, railroad cars, warehouses, lumber resources, and other facilities it needed into its operations. Lucrative deals with railroads were made and that drove smaller refiners out of business. (Sampson, A. , 1975) Around 1878 when Rockefeller and partner Henry Flagler (1830-1913) were in control of most of the nation’s oil refining business.
Because of its booming business in oil industry, Rockefeller’s was considered one of the five wealthiest men in the country. (Nevins, A. , 1953) In 1882 Rockefeller and his associates established the first trust in the United States, which consolidated all of Standard Oil Company’s assets in the states under the New York Company, in which Rockefeller was the major shareholder. (Nevins, A. , 1953) Standard Oil began producing, refining and distributing oil in 1880’s. Overseas trade had begun mostly in kerosene to Great Britain.
The trust encountered challenges with the Sherman Antitrust Act of 1890, followed by an 1892 Ohio Supreme Court decision which forbade the trust to operate Standard of Ohio. The company then moved its base of its operations to New Jersey, which in 1899 became home to Standard Oil of New Jersey, or Jersey Standard. Jersey Standard later became Exxon Corporation (Wall, B. , 1988) In the 1920’s, as the supply of crude oil began shifting its way from the United States and Latin America to the Middle East, Jersey Standard and other companies effectively used the same monopolistic practices that John D. Rockefeller had used; Standard Oil exploited its rich resources in Iraq, Iran, and Saudi Arabia.
This made oil prices stayed low and the United States and Europe became extremely dependent on oil fuels for industry and automobiles. (Nevins, A. , 1953) The Organization of Petroleum Exporting Countries (OPEC) was formed to protect the interests of the producing countries and this led to Jersey Standard sought other sources of crude oil. The company discovered oil fields in Alaska’s Prudhoe Bay and in the North Sea.
Around the same time, in 1972, Standard Oil of New Jersey officially changed its name to Exxon Corporation. (Wall, B. , 1988) As the OPEC-induced oil shortage depleted much of Exxon’s reserves made them experience financial difficulties; and a lot of people suffered from this cause. In 1989 when a drunk Captain of the oil tanker Exxon Valdez ran aground in Alaska’s Prince William Sound, doing immeasurable damage to the wildlife and to the company’s public image. Eleven million gallons of oil spilled in the Alaskan harbor this made Exxon lost a share of the world oil market to its competitor, Royal Dutch/Shell in 1990.
However this didn’t stopped Exxon’s business when they agreed to a $15 billion development of three oil wells in Russia. (Clarke, 1997) Overall, Exxon started in the United States, which started as a regional marketer of kerosene that evolved to the biggest publicly traded petroleum and petrochemical project in the world. Their best known brand names are Exxon, Esso and Mobil. Such products that drive modern transportation, power cities, lubricate industry and provide petrochemical building blocks that lead to thousands of consumer goods.