i86 GILBERT HOLLAND MONTAGUE 



ing such favorable rates for independent refiners; and on 

 March 31, 1879, all payments of rebates ceased. 



In view of the bitterness of the war which it settled, this 

 agreement was very favorable to the defeated party. The 

 Pennsylvania railroad had gone out of its way to strike at the 

 power of the Standard "alliance/' and after expensive fight- 

 ing had been completely beaten and forced to sue for such 

 terms as might mercifully be granted it. The Standard Oil 

 company, however, required of it only such favors as it al- 

 ready received of the New York Central and the Erie rail- 

 roads, and, in return, guaranteed its oil traffic, purchased its 

 interest in the Empire Transportation company, and advanced 

 the money to buy oil cars. It was, indeed, shrewd magnanim- 

 ity; for, in advancing the money to complete the sale, the 

 Standard Oil company became the mortgager of the oil cars of 

 the railroad, and by aid of the discriminations provided in 

 the contract it was able, in a few months, to drive the Colum- 

 bia Conduit company into selling. So that in 1878 and 1879 

 the Standard Oil company owned or controlled by contract 

 every transporting agent in the oil regions. 



The achievement of this supremacy marks the close of 

 the first phase of the Standard Oil company. It owned the 

 terminal facilities of the New York Central for handling oil at 

 New York. It leased the terminal facilities of the Erie rail- 

 road at New York. It owned or leased almost all the oil cars 

 on the Erie, the New York Central, and the Pennsylvania 

 railroad. Through the United Pipe Line company and the 

 American Transfer company, it purchased, one after another, 

 twenty six pipe lines that threatened competition. And 

 vhen, in 1879, the Tidewater Pipe Line company was built 

 ;o the seaboard, in order to evade the discriminations of the 

 railways, the Standard Oil company was able, after a struggle 

 of four years, to defeat that, also. The dominance of the 

 Standard Oil company in the refining industry was even more 

 :iking. In 1879 it controlled 95 per cent of the refineries in 

 the oil region, and at one time during this period there were 

 scarcely a dozen independent refiners in business. 



The organization of the Standard "alliance," which in 

 1879 controlled the transportation of oil by rail and by pipe 



