Socony Gasoline – Standard Oil Company of New York
Socony Gasoline was an acronym for the Standard Oil Company of New York and was very popular in the early 1900’s following the demise of Standard oil in 1911. Socony later merged with the Vacuum Oil company in 1931 and eventually became Mobil as we know it today. In May of 1911, The Supreme Court forced Standard to break into 34 independent companies, one of them being the Standard Oil Company of New York. The reason for the ruling was to keep the large conglomerate from price gouging and unfair business practices that forces smaller companies out of business. Price gouging has always been a sore subject here in the U.S. and it is evident even in the early 1900’s as seen in the following article from the Harrisburg Telegraph in 1916. It appears that even though Standard Oil was split up, its “baby” companies were continuing the same behavior. You can see some of the better advertisement for Socony Gasoline in between.
Gasoline Pricing Fixed Charge – (Harrisburg Telegraph 1916) A thorough investigation to determine why the price of gasoline has increased from 8 cents a gallon last August to 19 cents in St. Louis and 25 to 30 cents elsewhere, leads to the conclusion that it is due principally to manipulation by Standard Oil corporations.
Last year when the price of crude oil, from which gasoline is refined, was 30 to 35 cents a barrel, Standard Oil subsidiaries bought and stored in Oklahoma not less than 70,000,000 barrels. This same oil is selling in the market to-day at $2 to $2.15 a barrel. Standard Oil profit, allowing 10 cents a barrel for carrying costs, is not less than $1.50 a barrel, or more than $100,000,000 on the oil put in storage less than a year ago. Nearly everybody in the oil and gasoline industry here says that the high price of gasoline is due to the law of supply and demand. But, in the same breath, they say the price of crude oil in the mid-continent field is fixed absolutely by the posted bid of the Prairie Oil and Gas Company, a Standard Oil subsidiary.
Production of crude oil in this field in 1915 was about 107,000,000 barrels, as against 102,000,000 in 1914, and 63,000,00 in 1913. Producers expect a decrease of 3 per cent, this year as (compared with last year, unless new pools are tapped. Meantime, the Standard Oil Company has at least 100,000,000 barrels stored in tanks in Oklahoma.
Summary of the Situation – A 42-gallon barrel of Cushing crude oil will produce, of gasoline, at least 10 1/2 gallons. Last year the Standard Oil bought and stored In Oklahoma 70,000,000 barrels of Cushing crude oil at a cost, with carrying charges, on a barrel, 40 cents each. Cost of refining a barrel of crude oil is not in excess of 25 cents. By products like kerosene, fuel oil, lubricating oil, etc., will more than pay cost of refining. Standard will market the 10 1/2 gallons of gasoline at an average price of per gallon, 20 cents. For the 40 cent barrel of crude oil, it will receive from gasoline alone $2.10, its net profit being not, less than $1.60 on the barrel of crude oil. Profits on its 70,000,000 barrels of stored crude oil, at present market prices, $112,000,000.
Just below that article was this snippet – Standard Oil of N. Y. Doubled 1914 Profits – Profits of the Standard Oil Company of New York for 1915 were more than double those of the preceding year. Net earnings of $15,761,663 show an increase of $8,025,744, the surplus increasing from $1,736,000 to $9,761,663, 1 and the total surplus from $18,701,591 to $26,463,254.
I’m sure that the person reading this in a newspaper almost 100 years ago had the same feeling that most people feel today. The gas companies are making their bank accounts larger while blaming the cost of gas on outside factors beyond their control. Although, I doubt anyone would complain about 19 cents per gallon today 😉