In 1859, events took place on opposite sides of the Atlantic that created two of the most powerful industries in the world.
First, Edwin Drake drilled the first oil well in the U.S. in Titusville, Pennsylvania.
Then, J.J. Etienne Lenoir built the first single cylinder two-stroke internal combustion engine in Paris, France. But that’s about as close as the oil and automotive industries would get for another four decades.
John D. Rockefeller and Henry Flagler built a viable oil industry following Drake’s discovery. The first refinery in the United States began in 1862; it mainly produced kerosene as well as a byproduct, gasoline, which didn’t have much use at the time.
Across the Atlantic in Paris, Lenoir used his invention to power the hydrogen fuel-powered Hippomobile: A marvel of the time that could travel 11 miles in about three hours. You could walk that distance faster. Here’s how unconnected the automotive and oil industries were in the beginning: the first kerosene pump was manufactured in 1885 and sold to a grocery store owner, Jake Gumper, in Fort Wayne, Indiana; the first gasoline-powered tractor wasn’t built until 1892; the first patent for a gasoline-powered car wasn’t issued until 1895. …show more content…
Originally, Gumper’s pump, invented by one of the most fantastically named men ever, Sylvanus Freelove Bowser, reliably measured and dispensed kerosene. After Henry Ford’s Model T’s started rolling off the line in 1908, Bowser realized his pump was perfect for use at filling stations. By 1910, Bowser had evolved his pump into the metered gasoline pump. The number of cars on the road rose from 8,000 to 125,000. At the same time, the refining industry began focusing on turning crude into gasoline. The industry eventual evolved into producing not just fuel for the car but also fuel for planes, jets and rockets, and all the fuel hungry innovations that followed. Today, the oil and automotive industries are interdependent – basically joined at the hip. For Lenoir and Drake, the automobile and oil industries have grown into something they probably couldn’t have imagined. Meanwhile, the beneficiaries of Bowser’s innovation is found the world over as global demand for fuel exploded. We’re in a very interesting period of time... U.S. production of gasoline hit a five-year high. At the same time, U.S. imports of gasoline hit their highest level since September 2010. Demand for gasoline is up over 4% compared to this time last year. And I’ve written here before that refiners have been running at extremely high rates this year. We had utilization rates hit the highest levels they’ve been since before the financial crisis. And this is why refiners, particularly in this low-cost crude environment, have been the best bet for gains in the energy space. And will continue to be so. The biggest part of this has to do with the way people think about money and costs. Behavioral economist Richard Thaler points out in his latest book Misbehaving the last time crude prices fell 50% and prices at the pump tumbled in 2007, Americans did something strange... they bought more premium gasoline. It’s nonsensical. The reasoning from Thaler’s standpoint is that most people budget a specific amount for everyday items,
First, Edwin Drake drilled the first oil well in the U.S. in Titusville, Pennsylvania.
Then, J.J. Etienne Lenoir built the first single cylinder two-stroke internal combustion engine in Paris, France. But that’s about as close as the oil and automotive industries would get for another four decades.
John D. Rockefeller and Henry Flagler built a viable oil industry following Drake’s discovery. The first refinery in the United States began in 1862; it mainly produced kerosene as well as a byproduct, gasoline, which didn’t have much use at the time.
Across the Atlantic in Paris, Lenoir used his invention to power the hydrogen fuel-powered Hippomobile: A marvel of the time that could travel 11 miles in about three hours. You could walk that distance faster. Here’s how unconnected the automotive and oil industries were in the beginning: the first kerosene pump was manufactured in 1885 and sold to a grocery store owner, Jake Gumper, in Fort Wayne, Indiana; the first gasoline-powered tractor wasn’t built until 1892; the first patent for a gasoline-powered car wasn’t issued until 1895. …show more content…
Originally, Gumper’s pump, invented by one of the most fantastically named men ever, Sylvanus Freelove Bowser, reliably measured and dispensed kerosene. After Henry Ford’s Model T’s started rolling off the line in 1908, Bowser realized his pump was perfect for use at filling stations. By 1910, Bowser had evolved his pump into the metered gasoline pump. The number of cars on the road rose from 8,000 to 125,000. At the same time, the refining industry began focusing on turning crude into gasoline. The industry eventual evolved into producing not just fuel for the car but also fuel for planes, jets and rockets, and all the fuel hungry innovations that followed. Today, the oil and automotive industries are interdependent – basically joined at the hip. For Lenoir and Drake, the automobile and oil industries have grown into something they probably couldn’t have imagined. Meanwhile, the beneficiaries of Bowser’s innovation is found the world over as global demand for fuel exploded. We’re in a very interesting period of time... U.S. production of gasoline hit a five-year high. At the same time, U.S. imports of gasoline hit their highest level since September 2010. Demand for gasoline is up over 4% compared to this time last year. And I’ve written here before that refiners have been running at extremely high rates this year. We had utilization rates hit the highest levels they’ve been since before the financial crisis. And this is why refiners, particularly in this low-cost crude environment, have been the best bet for gains in the energy space. And will continue to be so. The biggest part of this has to do with the way people think about money and costs. Behavioral economist Richard Thaler points out in his latest book Misbehaving the last time crude prices fell 50% and prices at the pump tumbled in 2007, Americans did something strange... they bought more premium gasoline. It’s nonsensical. The reasoning from Thaler’s standpoint is that most people budget a specific amount for everyday items,