Chevron and Oil Trade Dominance
Chevron Corporation is a publically traded world leader in the energy market, trading oil and its byproducts, natural gas, as well as participating and leading in research into alternative energy sources such as solar and geothermal. They’re the third largest oil company in the world (Chevron CNN), and despite recent major legal action against the company they remain profitable.
Chevron began as a variety of companies. Originally the company was known as ‘Standard Oil Co.’ (Chevron SFGate), which itself was a splitoff from Standard Oil. Standard Oil was at one point the largest oil refiner in the world, and was headed by the Rockefeller family. Famed for their dominance over all aspects of the oil refinery business, ranging from harvest to production to distribution, Standard Oil was considered one of the major trusts in the early 1900s until it was split apart in 1911. The power and control Standard Oil had over the entire market was immense, and as a result the Supreme Court broke apart Standard Oil in Standard Oil Co. of New Jersey v. United States. (Standard Cornell).
Standard Oil Co. was a California focused oil company, dominating much of the oil production in the west coast. Early on refining was typically not the primary objective of the company, instead preferring to drill wells considering the amount of them all throughout California. They were a major factor in the development of stable supply lines to other parts of the country, and were able to maintain their dominance well into the 1950s. It’s during that point when Standard Oil Co of California, also known as SoCal, became part of the ‘Seven Sisters.’ These oil companies together formed the ‘Consortium for Iran’ under which they all shared their oil distribution networks, and essentially allowed Iranian oil to get back on the United States market despite how much public opinion was against Iran at the time. Together these companies controlled 85% of the world’s oil reserves (Hoyas) and it was under this situation that SoCal was able to become a world force.
As SoCal grew it became clearer that for further growth the company must begin purchasing others to maintain growth rate. While SoCal had expanded majorly from its purely western roots before, into places such as Saudi Arabia where it discovered the world’s largest oil field, or into the borders of Texas, claimed lands began to greatly outnumber new potential oil sites. Many of these new sites were owned by Gulf Oil, which itself was part of the Consortium for Iran and a fellow American-owned company. As such SoCal purchased Gulf Oil from the Mellon family in 1984, marking the record books as the world’s largest company merger (Vermont). Naturally this caused problems with United States anti-trust laws, requiring the newly formed company to sell off much of Gulf Oil’s refining capabilities. SoCal essentially purchased Gulf Oil primarily for the land rights, so in effect this did little to...