Five Key Moments in the History of Oil

Undoing oil dependency: Five key moments in the history of oil

"The world expects several decades of growing supplies of generally affordable oil," writes oil-man turned solar entrepreneur Jeremy Leggett in Sublime magazine. "Every corporate and ministerial plan is geared to this assumption," he notes, but the opposite is a more realistic likelihood: "Beyond the peak of global oil production the world faces shrinking supplies of increasingly expensive oil." Celsias readers will be no strangers to the idea of Peak Oil, and while we slowly wake up - even George W. Bush recognizes that we are "addicted to oil" -- the consequences of our petroleum dependence are accelerating towards us.

As we contemplate a life without cheap oil, it might be a good idea to look back at how we got into this mess in the first place. By understanding the rise of oil and its associated products, perhaps we can see a way back to life without it. Without attempting a complete history, I want to look at five key dependency-creating moments in the history of oil.

1. The electric light bulb

Oil as we know it has been in use for centuries. The Romans used it for flaming arrows, the Greeks and the Chinese knew of it. The Zoroastrians worshipped the eternal fires of burning natural gas in Azerbaijan. Marco Polo, exploring in 1272, observed the oil lamps of the Caspian sea. Historically, where oil was known and understood, it was used for lighting. In Europe however, people burned animal fat, and then whale oil to light their homes. It wasn't until Edwin Drake stumbled across easy oil in Pennsylvania in 1858 that it became available in the West.

At the end of the 19th century, whale oil for lighting was in short supply, with sperm whale numbers collapsing. Kerosene stepped into the gap, providing cheaper, healthier and more efficient lighting for millions of homes. It rapidly became people's lighting fuel of choice, making a fortune for entrepreneurs such as JD Rockefeller, and giving birth to the first multinational corporation in his mighty Standard Oil company. But, the kerosene age was not to last -- in 1879, Thomas Edison invented the light bulb. It was a remarkable invention, and with this new, clean, safe and reliable source of light, not to mention the almost magical promise of electricity, kerosene suddenly didn't look nearly as exciting any more.

As the market for the electric bulb grew, the market for kerosene faded. At this point, oil could have become obsolete. By 1886 however, Karl Benz had invented an automobile with an engine that ran on gasoline -- a by-product of the kerosene process. The oil companies immediately recognized the technology that could save them. They made the switch from kerosene to gasoline, lighting to transport, and turned their attention to the motoring industry. From then on, the oil industry made transport their primary focus, as we know it today. Transport, in turn, was to become heavily dependent on oil.

2. The Model T Ford

Henry Ford with his Model T
The first cars were dirty, slow and uncomfortable. They were hugely expensive, and aside from the novelty factor of the 'horseless carriages', you really were better off with the horse. It was Henry Ford's Model T that changed that in 1908. His stroke of genius was the production line, the moving conveyor that at its peak could roll 120 cars an hour through the doors of his Rouge River factory. The efficiency of the production line brought the price of the car within reach of even the factory's own workers. Says Matthew Yeomans in his history 'Oil': "Until the Model T arrived, owning a car had been a luxury." It "democratized driving in America."

The impact on American life took a couple of decades to reveal itself. The new mobility allowed people to move out of the overcrowded cities, and the cities saw improvements in sanitation, crime and disease as a result. Houses were built on the cheaper land just outside the city, giving people the chance to own property they could not have afforded previously. City-dwellers re-discovered the countryside. They made day-trips and road-trips. Visits to national parks went up tenfold. When economic crisis started to bite in the 30s, families were able to load their possessions and head West to seek new opportunities.

But, cities began to find themselves congested with cars instead of people. Streets were re-designed and widened. Whole areas were demolished for highways. Trams and trolley-cars were in the way, deemed no longer necessary and dismantled, sometimes with the direct involvement of the car companies -- General Motors secretly bought LA's trolley system and promptly decommissioned it. Franklin D Roosevelt's New Deal put a million laborers to work on a national road network. The very landscape was shaped by and for the automobile. Before long, a car was a necessity.

The Model T represented a great new freedom to travel, but the mobility it made possible has become a burden. We no longer get the choice, and the average American must now spend 70 minutes a day in their car. Mass car ownership is a privilege and a blessing, but it created a dependence on oil for the most mundane of daily tasks -- getting to work, buying the groceries. Still, the story of the Model T and 'a car for the people' repeated itself in Germany with the Volkswagen and in Britain with the Mini. There's a good chance it just began again in India, with the Tata Nano.

3. The First World War

The DH9 was the most produced British aeroplane of World War I
Rooting around in the basement of an old second-hand bookshop this afternoon, I came across a volume of Standard Oil New Jersey's 'Collected Technical Publications', from 1948. The introduction by RT Haslam is called 'World Energy and World Peace', in which the Chief Executive enthusiastically declares that the cheap energy of oil could usher in 2000 years of world peace. In 1948 the world was still reeling from decades of violence on an unprecedented scale, so a little naive optimism can be forgiven, but oil and war had gone together from the beginning.

The First World War linked oil and conflict forever. Newly invented tanks crawled their muddy way to victory in French fields, while hastily formed air forces built and flew thousands of planes. With remarkable foresight, the young Winston Churchill, then First Lord of the Admiralty, had commissioned a fleet of petrol-driven ships in 1912. Powered by US and Persian oil, they out-maneuvered and sank the coal-driven enemy. The UK even found time to invade Iraq for its oil, seizing it from the Turks and proving there's nothing new under the sun. "This is a petrol war" said an advert for Pratt's Motor Spirit from the time, while Shell boasted "never before in war has the value of the petrol-driven engine been so incontrovertibly proved as in the current conflict." (A Century in Oil, Stephen Howarth)

"If War Gas falls from the sky... HE’LL BE READY!" World War II Ad Showing Plastic Anti-Chemical Warfare Body Bag
On the other side of the Atlantic, the US army was one of the first big investors in the young automobile industry. With the looming possibility that large numbers of troops might need to be mobilized at short notice, the army bought thousands of trucks. When it came to use them, it discovered the networks of roads across the US was so poor that the trucks ended up being loaded onto railway cars and transported by train anyway. It highlighted the military importance of roads, and it should come as no surprise that the boom in asphalt road building in the 50s was done under the National Interstate and Defense Highway System Act.

The First World War was the first industrial war. It made us dependent on oil for defense, and we haven't looked back. According the Energy Information Administration, the US army uses 65 million barrels of oil a year (PDF). An Abrams tank can use 12 gallons of fuel an hour just idling, while overhead B-2 bombers flew Afghan missions direct from Missouri, refueling in mid-air 12 times along the way.

Despite RT Haslam's ideals, oil has not brought peace. Once the dependency was there, it proved to be quite the reverse -- nothing threatens global stability more than our thirst for oil.

4. The discovery of fertilizer

In the late 1920s competing interests and new sources of oil had accidentally conspired to create a glut. The market was saturated, and prices began to fall. The oil companies realized how dependent they were on one product, gasoline, but gasoline only amounts to 45% of a barrel of crude. There are all manner of other liquid and gas by-products of the refining process, many of which were simply burned. With profits dwindling on gasoline, Standard Oil New Jersey began to explore ways to monetarise the by-products, and other companies rapidly followed suit. They invested in R+D, opened laboratories, and began to discover a whole world of possible applications.

"The larger the number of products we make", said Shell board member JBA Kessler Jr, "either in the form of oil or in some other form, say artificial manure, the safer we are against any drop in prices of some of these products." By 1929, that 'artificial manure' was a reality.

A German chemist named Fritz Haber had already discovered the process of extracting nitrogen from the air. Under enormous pressure and intense methane-produced heat, nitrogen could be turned into ammonia, and this could then be used for fertilizers - a process Sonia Shah describes as "the Holy Grail of inorganic chemistry" in her book 'Crude: the story of oil'. With the investment capital of the oil companies, fertilizers were released into the agricultural world.

Over the next 50 years, agricultural yields doubled. Levels of malnourishment fell, life expectancy rose. People were better fed and healthier than they had ever been. The result was that in that same 50 years, world population also doubled.

As yields grew, farms grew too. They were mechanized, and oil became part of the agricultural process. It was homogenized, giving us the rise of industrially amenable ingredients such as corn syrup, palm oil and soy. Farms were also centralized. Economies of scale meant it was cheaper to produce food on big farms and transport it than to grow food locally. More food was traded internationally, and countries developed food deficits and surpluses. The UK, for example, now grows only 65% of its food. As Raj Patel writes in his overview of world agriculture, 'Stuffed and Starved': "UK stomachs became hostage to its fuel supply."

We have become completely dependent on oil for both growing and distributing our food. Farmers spread a total of 85 million tons of fertilizers on their crops in 2000, representing half a billion barrels of oil, and the average American meal travels 2000 miles before it reaches the plate.

5. Synthetic rubber

There were plastics before oil. There's natural rubber for example, or celluloid, which is made from cotton and vegetable oil. Plastics can be derived from amber, wax, even milk, but none of these has the economic potential of synthetic, oil-based plastic. Interestingly though, synthetic plastics are a child of war.

Rubber was first discovered and exploited in the Amazon. The ancient civilizations across South America had used it in a number of different ways, including balls for a tennis-like sport that archeologists are still trying to decipher from the ruins. It was here that its commercial uses were first discovered, and a rubber boom followed. By the mid nineteenth century, the wild rubber of the Amazon was being over-tapped. As John Loadman explains in his history of rubber, 'Tears of the Tree', prices rose and quality fell, and after several failed attempts, British botanists successfully transplanted seedlings to India. The Amazonian rubber industry collapsed, and the plantations of Southeast Asia took on the challenge of supplying the vast quantities required by American and European industry.

The turning point came in 1941, at the height of the Second World War, when Japan seized these plantations and cut off the rubber supply. The consequences for military operations were dire - the war effort needed rubber. "For American soldiers and pilots fighting in Europe," writes Sonia Shah, "a flat tire had become a death sentence."

In response, the US government turned to the oil industry and its petrochemicals labs. Already working overtime to provide oil for the war, they now had to provide rubber too. With the help of billions of dollars of government investment, the oil industry delivered not just synthetic rubber for tires and life rafts, but nylon for parachutes, plexiglas for airplane windows, and nitrogen ammonia for plastic explosives.

By the end of the war, plastic was the future, the glamorous material of the space-age. Disneyland even built an attraction in 1957, the Monsanto 'Plastics Home of the Future'. It's hard to imagine now, but five to ten thousand people a day queued up to see "a demonstration of the structural applications of plastics."

Looking around my desk, I am surrounded by plastics. I'm typing plastic keys, looking at a screen in a plastic case. My pens are plastic, the remote for the stereo, the light switch, the lamp shade, the CDs and the CD cases. There's a glue stick in a plastic tube, a magazine in a cellophane sleeve. The buttons on my shirt are plastic. Every one of these items is dependent on oil. When the oil squeeze comes, as it inevitably will, there is not a single area of consumer production that will escape the rising prices.


There are other things I could add here. I haven't touched on the oil industry's involvement in medicine, for example, but these are the five most important moments in the history of our oil dependency. The challenge now is to break that dependency, to undo oil, and Celsias is packed with good writing on that subject. In some ways, the solutions are obvious -- investment in public transport, organic farming, renewable energy. We can promote more sustainable materials like bamboo, re-discover natural plastics. Above all, we can build things to last and throw less away -- plastic is almost synonymous with 'disposable'.

In some cases the solutions are more complex. Breaking the self-destructive link between oil and defense requires diplomacy, compromise, investment in institutions such as the UN. As oil becomes scarcer, we are faced with only two alternatives: reduce our oil dependency, or fight harder for what remains of it. Can the Pentagon or the Department of State be persuaded to pick the first of those, and make environmental sustainability a matter of national security? The idea that it is in the national interest to back away from oil, rather than seize it, demands a revolutionary change of thinking.

Still, I remain an optimist. Looking at the history of oil, it's clear that deliberate and targeted investment created our oil dependency, either out of necessity or out of business opportunity. It was not an accident, and it was not inevitable. It's also clear that the oil industry has proved to be remarkably adaptable. With bold leadership and creative thinking it can change again, diversifying and truly moving 'beyond petroleum', as BP have suggested in the past and then backtracked on.

Weaning the world off oil might just require a sixth key moment in the history of oil. Perhaps that key moment will be Peak Oil -- time will tell. Either way, let's hope the final chapter in the history of our oil economy will be characterised by another wave of innovation, freedom, and quality of life, rather than desperation, greed and conflict. With capital investment, government incentives, and informed consumer choice, it can be done. There is still time to undo oil.

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  • Posted on Feb. 27, 2008. Listed in:

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