In the early eighties the awakening Baku opera tors began their attempts to introduce Russian oil into the important trade of Smyrna and other cities of the near East. Shipments made via Ba toum had to travel hardly a third the distance cov ered by oil from this country, yet the American representative in Smyrna, as late as 1884, assured the operators that there was no cause to fear any injury to their interests.
In Russia, too, the Americans had introduced their goods successfully almost to the very doors of the Baku region. Throughout western Russia the merchants found it cheaper to get their oil from America rather than from Baku. Whole cargoes were sold in Moscow, one of the most important markets in the country, and easily reached by the Volga route from the Caspian, while St. Peters burg took over 100,000 barrels a year.
Signs of an impending struggle, however, began to appear soon after the advent of the Nobels at Baku. The stress of circumstances which had kept down the Baku industry so long was gradually re lieved. Baku 9perators were determined to have their rightful share of the oil trade. The Ameri cans for the first time had a rival, a rival against whom they have had to struggle ever since, in in creasing competition for the big markets of the world.
All the advantage, of course, was at first on the American side, controlling as it did the whole oil trade, even to Russian centers themselves. The American industry was also thoroughly estab lished, conducted by a powerful corporation, pos sessing every known facility, and determined to continue its domination of the oil business. With out the Standard concern, or a similar concern, the American interests in foreign markets would certainly have fared badly in the years since 1885. Individual companies could never have successfully established such a comprehensive and efficient sys tem of transportation and distribution to cover the whole world. Smaller companies working separ ately could never have waged such a successful war for the oil trade under the very shadow of Russian territory. Great capital has always given the Standard its chief advantage in the struggle for foreign trade ; enormous resources have been the keystone of its success there no less than at home.
Less powerful interests could scarcely have af forded the time spent and expense incurred in pushing the trade as the Standard did from 1879 onward. The Standard leaders believed that great as the growth of the oil trade had been, it could be made still greater, if the right methods were adopted. With their usual wisdom they proceeded to investigate before acting and representatives were sent to all parts of the world to study and re port on the existing conditions. One important outcome was the breaking down of much local op position, removal of official boycotts, and repeal of absurd duties and restrictions, which had com pletely excluded the oil from numerous Oriental districts. Local officials, personally interested in the sale of native oils for illuminating, had in many cases, made the use of petroleum a capital offence, because it threatened their own revenues. A Hin du would never trade with a Mohammedan agent or vice versa, while both hated a Christian, yet native labor was necessary in extending operations on ac count of the multitude of languages spoken ; and the solution had to be worked out on the spot. All through the East a multitude of such difficulties were overcome, in fact, are still being met and over come, in expanding the market for American products. How it has been done in the face of deep-rooted Oriental prejudices and suspicions is the most wonderful part of all.
No smaller concern could have taken advantage of the innumerable economies, large and small, to cut the cost of production and make it possible to place the oil in the markets of Europe or Asia as cheaply as it can be done from Baku or from Bor neo. To-do this the great marine department of the Standard Oil Company has been necessary, making a connecting link between the shipping points on our coast and a distributing system in many foreign countries exactly duplicating the one here. A fleet of four-score steamers and sailing vessels, as well as a host of tugs and barges, has been organized by the Standard to carry oil in bulk, and dozens of other vessels are chartered annually from private owners. Bulk carriage has been half the secret of the success abroad as well as at home.