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Line 24:
Line 24: − In 1862 Cleveland had become established as one of the main refining centers in the U.S., and Standard was the most profitable refiner in Cleveland. When it was found out that at least part of Standard Oil's cost advantage came from secret rebates from the railroads bringing oil into Cleveland, the competing refiners insisted on getting similar rebates, and the railroads quickly complied. By then, however, Standard Oil had grown to become one of the largest shippers of oil and kerosene in the country.+ + + +
→Standard Oil: details
===Standard Oil===
===Standard Oil===
[[Image:John-D-Rockefeller-sen.jpg|thumb|200px|John D. Rockefeller ca. 1875]]
[[Image:John-D-Rockefeller-sen.jpg|thumb|200px|John D. Rockefeller ca. 1875]]
Having outgrown the partnership form of organization, Rockefeller incorporated '''Standard Oil Company of Ohio''' in ealy 1870 with 10,000 shares of $100 par value, of which Rockefeller held 2,667.
Cleveland was one of the main refining centers in the U.S., and Standard was the most profitable refiner in Cleveland. When it was found out that at least part of Standard Oil's cost advantage came from secret rebates from the railroads bringing oil into Cleveland, the competing refiners insisted on getting similar rebates, and the railroads quickly complied. By then, however, Standard Oil had grown to become one of the largest shippers of oil and kerosene in the country.
The railroads were competing fiercely for traffic and, in an attempt to create a cartel to 'stabilize' freight rates, formed the South Improvement Company. Rockefeller agreed to support this cartel if they gave him preferential treatment as a high volume shipper which included not just steep rebates for his product, but also rebates for the shipment of competing products. Part of this scheme was the announcement of sharply increased freight charges. This touched off a firestorm of protest, which eventually led to the discovery of Standard Oil's part of the deal. A major New York refiner, Charles Pratt and Company, headed by Charles Pratt and Henry H. Rogers, led the opposition to this plan, and railroads soon backed off.
The railroads were competing fiercely for traffic and, in an attempt to create a cartel to 'stabilize' freight rates, formed the South Improvement Company. Rockefeller agreed to support this cartel if they gave him preferential treatment as a high volume shipper which included not just steep rebates for his product, but also rebates for the shipment of competing products. Part of this scheme was the announcement of sharply increased freight charges. This touched off a firestorm of protest, which eventually led to the discovery of Standard Oil's part of the deal. A major New York refiner, Charles Pratt and Company, headed by Charles Pratt and Henry H. Rogers, led the opposition to this plan, and railroads soon backed off.