3 Important Periods in the History of the Oil and Gas Industry
Today there are enough global oil reserves to continue production at the current pace for another 53.3 years. This is good news for the 9.8 million people currently working in the industry (8% of U.S. economy). Evolution will have to keep happening in the field for this to continue beyond that though. If you want to more accurately predict oil and gas industry trends, it’s important to understand the historical relevance these natural resources have had. While the equipment, processes, and usage have evolved over the years, the value of oil and gas has similarly increased since its discovery. Today we will highlight three of the most important time periods in the history of the oil industry.
The Discovery of Oil
Oil was first found in pits and river banks in Greece and the surrounding areas over 4,000 years ago, according to early historians. However, the first documented oil wells in existence were developed in China, circa 347 AD out of bamboo. It didn’t take long for the oil and gas industry to begin to develop its foothold in the nearby Middle Eastern region, which they of course still rely on today.
Oil Starts Taking Off in the 19th Century
Edwin Drake is credited with drilling the first crude oil well in the U.S. in 1859 using cable tools. Perhaps the biggest turning point though was when John D. Rockefeller formed the Standard Oil Company in 1865. This would eventually cement his legacy as the industry’s first “baron.” Rockefeller began to utilize horizontal integration strategies by buying up smaller competitors to become one of the biggest and most successful companies in history.
Oil’s Usage During the World Wars and Into the Future
The 1900s would see the oil and gas industry rise to new heights never before seen. World War I would be the first time oil began to be seen as not only a source of energy, but also a strategic military asset as it powered the ships, trucks, tanks, and planes used in warfare. In 1919 gasoline sales would exceed kerosene and never look back. World War II would only accelerate this unobstructed growth until environmental concerns and alternative energy exploration became popular in the last decade or so. Still, global proved oil reserves have increased by 27% (350 billion barrels) over the past decade alone.