A year after the Oil Creek development began, the production of petroleum averaged 200 barrels a day. In January, 1861, it was 700 barrels a day, and in the spring of that year the produc tion had again doubled as the result of many mod erate-sized wells which had been opened. Then came the gushers, yielding thousands of barrels each, and jumping the total yield up to 10,000 barrels a day. Some of the oil from the ear lier wells had brought as high as a dollar a gal lon, and in spite of the gradual decline in price as the yield increased, there was good profit in the oil selling around twenty-five cents a gallon in the early part of 1861. But as successive gushers were struck in the summer and autumn of that year prices almost ceased to exist. Oil was as cheap as water, so cheap, in fact, that thousands of barrels were allowed to run to waste into Oil Creek, and sales were made as low as ten cents for a barrel of forty-two gallons. One man, having sold a boat load of oil at a few cents a barrel is said to have playfully turned a stream of oil into the boat until it was swamped, because the purchaser complained that the boat as loaded was a few barrels short of the quantity for which he had paid.
Many of the early operators lost heavily on their first ventures as a result of these low prices, but the losses do not seem to have shaken their faith in the future of the oil industry. In 1861 and 1862 a number of refineries to handle the oil were built both along Oil Creek and in other parts of the country, and, when the production rose above the home demand in 1861, the dealers began to look for new markets in foreign countries. The first ex ports of oil consisted of 27,000 barrels sent to Europe in 1861. The quantity was so large and unexpected that the markets were glutted and the shippers suffered severely. But the way had been paved for future demands so that within a few years American petroleum was being shipped to nearly every important port in the world.
At the same time, other influences were helping to revive the industry from its marked depression. Production which had risen as high as 15,000 bar rels a day during the winter and spring of 1862 to 1863 dropped rapidly to not over half that amount in 1864 as the result of the abandonment of some wells and the declining yield of others. The restriction of whaling operations, as a result of the activity of Confederate cruisers, curtailed the supply of whale oil during the war, and made new demands for petroleum oils. Finally, the general increase of prices incident to the progress of the war put the profits up until they ranged from $3 to $10 a barrel. The industry was
greatly stimulated ; a new wave of speculation greater than the first swept over the oil fields, and the crest of excitement mounted higher and higher. In the midst of it all came the marvelous develop ment at Pithole Creek, the climax of the early boom.
Commencing at Titusville in the tide of de velopment had swept steadily over the valley of Oil Creek and along the Allegheny River above and be low Oil City. Each succeeding year had brought a new crop of operators eager to invest their capi tal in the venture, more than filling the places of those who had become discouraged or had been un fortunate and dropped out. Up to 1864 Oil Creek had been the only important locality, and there, toward the end of that year, the production was rapidly declining. Conditions were, therefore, just right for a general stampede to any new promis ing field.
In the winter of 1864 and 1865, the Fraser well, flowing at the rate of 650 barrels a day, was struck in the neighboring valley of Pithole Creek. Oper ators from the older places thronged to the new lo cality, and other wells were quickly sunk, with the most gratifying success. As soon as the glowing reports of six and seven thousand barrel wells were spread gbroad, unbounded excitement prevailed on every hand, and a grand rush for Pithole began. On foot and on horseback, in wagons loaded with every conceivable article, crowds of men of every degree and profession, eager to be first among the lucky ones, filled the roads to this new field of • riches. Fabulous prices were paid for the farms, and property changed hands with incredible ra pidity. More than $20,000 was paid as a bonus merely for the privilege of drilling a well on a half acre lease near one producing well, but even at this price the purchaser made a handsome profit on his lease—by selling it to some one else. And so it went, feeding fuel to the flames of the oil craze in every part of the country.
A magic city sprang up on the bluff overlooking the wells. The town plat of Pithole City was not commenced until the latter part of May, 1865, and within six months a modern city having a pop ulation estimated from 10,000 to 15,000 stood where there had been a mere handful of houses a year before. Miles of streets were lined with buildings, houses, business blocks, offices, churches and hotels, and town lots were selling for $10,000 each. Palatial hotels were erected to accommodate the hordes of speculators, investors, and operators. On all sides were the gaudy signs of sudden riches easily had and easily spent.