Does oil come in barrels?

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March 24 2005 6:11 PM

Does Oil Really Come in Barrels?

Not anymore.

Oil prices have dropped to less than $54 per barrel, on the news that the United States has 309.3 million barrels in its inventory. * Barrels? Do oil companies really put oil in barrels?

Not anymore. Classic wooden barrels were in widespread use only at the very beginning of the industry's history. When Edwin Drake drilled the first oil well in Titusville, Pa., in 1859, he used washtubs for storage. But production was greater than expected, and Drake turned to the wooden barrels used to transport other products such as salt, oysters, or whiskey.

Daniel Engber Daniel Engber

Daniel Engber is a columnist for Slate

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At the time customers paid by the barrel, but there was no standard size. Different oil buyers would get different amounts when they filled up from the stock tank at the well. The barrel most commonly used for oil was 40 gallons, the same size as a whiskey barrel. (Indeed, many oilmen used old whiskey barrels, and they may have used similarly sized salt and corn barrels as well.)

As production increased, a standardized oil barrel became more important, both for businessmen and for government tax collectors. Some wells were putting out more than 3,000 barrels of oil per day, and coopers were producing large numbers of brand-new containers just for oil. At around the same time, the federal government enacted dramatic new tax laws to help finance the Civil War—a standard measure of oil helped the office of the commissioner of Internal Revenue make its collections. By the 1870s the size of a barrel of oil had been set at 42 gallons, which corresponded to other standard sizes at the time: the 42-gallon "cran" of herring, for example, or the 42-gallon "tierce" of lard.

But the wooden barrel was already on the way out. When oil production spiked in early 1860s, prices dropped to as low as 10 cents per gallon. An empty barrel cost a couple of dollars, and the teamsters who hauled the barrels in wagons also charged dearly. These factors led to the development of the first oil pipeline by Samuel Van Syckel; the pipeline connected the boomtown of Pithole, Pa., with the rail terminal at Happy Farm.

Wooden tank cars appeared in 1865, the same year oil began to flow through the Van Syckel pipeline. A single rail car could hold 60 barrels of oil, while a tank car could hold 80 barrels in a pair of wooden tubs. Wagons with a large tank for holding oil (instead of a flat bed for carrying individual barrels) emerged in the 1880s, and the first steel tank barge appeared in 1892. With oil in tanks instead of barrels at every stage of the process, the barrel became obsolete.

The 42-gallon barrel is still a standard unit of measurement in the oil industry, though. Other units, such as cubic meters or imperial gallons, can be converted to the U.S. barrel fairly easily. For all of these measurements, care must be taken to correct for the effects of temperature, which can cause oil to expand or contract.

Though barrels may be close to extinct, companies still ship some oil in 55-gallon steel drums. (Volumes for these are still given in 42-gallon "barrels.") The steel drums used in calypso music are made from these 55-gallon containers. The first appeared in Trinidad, shortly after the end of World War II.

Explainer thanks Barbara Zolli of the Drake Well Museum and Park, and Jim Bear for asking the question.

Correction, March 25:This story originally stated that the United States has 309.3 billion barrels of oil in its inventory. The figure should have been 309.3 million barrels.

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