"January 10 marked the incorporation of the Standard Oil Company in Cleveland,” an Ohio newspaper reported in 1870. “The business was instituted with a full paid capital of $1,000,000."
That was the whole article. But then, almost nobody had yet heard of John D. Rockefeller, the 31-year-old financier of Standard Oil of Ohio, and his was far from the only new oil company in Cleveland.
The oil itself was spewing out of wells in Pennsylvania, 200 kilometres away, but Cleveland had emerged as a hub for the commodity’s refining and distribution. Rockefeller’s new company would do both.
History would reveal Standard (Ohio) as the cornerstone of a vast oil empire, the Standard Oil Trust, which would be dismantled in 1911 by order of the US Supreme Court, leaving the original Standard essentially where it had started, as a regional oil company with one Cleveland refinery and a compact marketing operation that sold, among other things, Perfection Oil and Eocene, two brands of kerosene for home heating and lighting.
Expansion, but quality service comes first
Fortunately for Standard this fork in the road came at a time when Americans were buying cars in astonishing numbers. On a corner in Cleveland, the first Standard “filling station” opened. It was a barn-like structure. Drivers pulled in one side, got their tank filled and drove out the other.
Soon Standard had stations throughout the area, with a strategy to make them as profitable as possible so the company could afford to expand in other areas. Service was the differentiator. It worked. In 1921 a new refinery opened at Toledo, Ohio, and was among the most advanced facilities of its kind.
By the 1930s, the company had adopted the trade name “Sohio” and painted its livery red, white and blue. At heart, though, Sohio was as Ohioan as it was American. Employees proudly called themselves “Sohioans” and the company’s marketing appealed to local conditions. Snow-covered roads featured in one ad for cold-weather gasoline, with the headline, “35% added starting power.”
In the 1950s Sohio chemists developed a one-step process for making acrylonitrile, a compound used in the manufacture of plastics and acrylic fibres. Chemicals companies worldwide adopted it.
From Alaska, oil for Sohio’s refineries
In the late 1960s, Sohio’s history dovetailed with BP’s. BP had found oil in Alaska but had no infrastructure in the United States to sell it through. Sohio had service stations and plenty of refining capacity but not a lot of crude oil. The two companies struck a deal.
BP initially took a 25 per cent stake in Sohio in exchange for the Alaskan crude, with the understanding that its shareholding in the company would rise with the production from Prudhoe Bay. The first oil flowed through the Trans-Alaska pipeline in 1977. The following year BP became the majority Sohio shareholder.
In 1987, BP acquired Sohio outright and made it the cornerstone of a new national operation, BP America.