Chapter 9-10 Summary and Analysis

Rockefeller's Cleveland refineries are further from the East Coast than the Oil Regions refineries are. As such, they face higher transportation costs. After the end of the SIC, Rockefeller comes up with a new plan, called the Pittsburgh Plan. This is to be a cartel headed by John D. that will limit production and negotiate favorable rates with the railroads. The refiners fight the plan and many will not adhere to their quotas until John D. dissolves it in 1873. The Pennsylvania producers form their own plan and end up burning the wells and destroying the equipment of non-cooperating members. Cartels always have problems try to enforce production limits.

In 1873 the economy enters into a downturn that lasts for six years. There are bank failures and railroad bankruptcies. Oil prices tumble and Rockefeller absorbs another group of failing competitors. They...