A Quick History of Crude Oil Pipelines

The first known proponent of using a pipeline to transport crude oil was a teenager named Samuel Duncan Karns and the year was 1860. Karns’ pipeline was never built however. The Civil War broke out in 1861 and the collective national consciousness turned from entrepreneurship to wartime concerns. The crude oil pipeline finally saw success the year the war ended though, and in 1865 an oil buyer and shipper named Samuel Van Syckel laid the first major crude oil pipeline in the Oil Creek region of Pennsylvania. Van Syckel, like many others before him, was outraged at the exorbitant cost of shipping oil, which in those days was done by loading barrels onto wagons or boats. Teamsters controlled these shipping lines and charged over $4 per barrel for long hauls and a $1 per barrel for shorter ones. The price of a barrel of oil then was $12.

In Focus: Former President Obama On Pipeline Expansion

Therefore, it was quite typical for one-third of the cost of a barrel of oil to be given over to shipping alone. To worsen matters, a new empty barrel during that time cost up to $3.25. Ergo, it was not unheard of for the shipping cost of a barrel of oil to account for over half the cost of every delivered barrel. The wooden barrels themselves posed a problem because they often leaked or fell from wagons and broke. However, there was little any oil merchant or buyer could do about this because the teamsters controlled the means of delivery and any opposition or attempt to change this was met with threats and sometimes even sabotage. Our current 42-gallon standard of “a barrel of oil” comes from this era of teamster-monopolized distribution although oil is no longer shipped or stored in barrels.

Ignoring menacing threats of violence and sabotage from the teamsters, Van Syckel effectively put an end to the barrel-on-a-wagon era and laid about five miles of 2-inch wrought iron pipe in 15-ft joints that connected his oil well with the nearest distribution point, Miller Farm Station. His pipe was partially underground, partially above ground, a layout still used to this very day. It could withstand 900 barrels of pressure per square inch and deliver 2,500 barrels of oil in one day. Using four Reed and Cogswell steam pumps, Van Syckel’s pipeline pumped 24 hours a day, 7 days a week, 365 days a year, and brought the cost of a barrel of delivered oil down to $1. To say that Van Syckel’s pipeline drove a stake through the heart of the teamsters’ barrel transport monopoly would be an understatement. Before the year was even out there were a multitude of pipelines already laid or being laid at various points in the oil-rich region of Pennsylvania.

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Modern Oil Pipelines