THREE CENTS A BARREL
On the morning of January 10, in a cow pasture four miles south of Beaumont, Texas, a group of oil drillers paused to replace a worn bit. They were working in a slightly elevated area known as Sour Spring Mound, where surface indications had convinced a few visionaries that oil lay underneath. The men installed a new bit, but before they could drill the 1,160-foot hole any deeper, mud began to spurt out the top with enough force to break off pieces of the wooden derrick. A few minutes later, a column of oil erupted.
It quickly grew to 6 inches across and 120 feet high—a size never before seen outside Russia’s Baku oil field. Five days later, the gusher was still going strong; in fact, its height had increased to 150 feet. Finally, after nine days, the drillers managed to cap it. By that time speculators had already begun to descend on Beaumont. In late March, when a second well started gushing, Beaumont’s population had nearly tripled. At the end of the year, the Spindletop field, as it was known, had 138 producing wells; by the following October, the total was 440.
At the height of the Spindle-top boom, crude oil dropped to an all-time low price of three cents a barrel. Oil companies worked off the surplus by marketing their product to railroads, shippers, sugar refiners, breweries, and other businesses as a cheap alternative to coal. They also sold a few gallons of gasoline to automobile owners, who were then a small, wealthy niche market.
The Spindletop field soon played out, but during its few years of glory, it got America accustomed to cheap oil. It would not be long before the nation’s thirst for petroleum outgrew its ability to produce it—something that during the last quarter of the twentieth century would become perhaps the most important factor in world politics.