No. 1, 2006
PhD (History), Member of the Russian Academy of Natural Sciences
AT THE DAWN OF THE KEROSENE ERA
In the 1860s and 1870s Russian and American kerosene was the object of a fierce tug-of-war on the Russian fuel market
The history of the early stage in the development of Russia's petroleum industry, which for a long time was fettered by an outdated tax-farming system, is quite instructive: it helps delve into such important problems, which are topical to this day, as national mentality and its manifestations in respect to business practices as well as the general and specific aspects of the history of Russia's petroleum industry in comparison with its European and American counterparts.
Separate starting points
The socio-economic processes which developed in Russia following the “great reforms” (that are called so in historical literature and that at times had a dissimilar and contradictory character) were reflected in different branches of the country's economy.
After 1861, against the background of major achievements in some of the leading economic branches, Russia's petroleum industry was in a state of stagnation caused by the dominance of that rudiment of the feudal period – the tax-farming system which was prevalent at the oil fields of the Apsheron peninsula.
In the 12-year period from 1850 to 1862 Russia produced 2,868,603 poods (one pood is equal to 16.3 kg) of crude oil – an average of 239,000 poods a year. This figure was topped in 1863: the output then came to 340,000 poods. The same year, however, the United States, where business was completely unfettered, produced 2,611,000 barrels of oil, which was 61.4 times more than Russia's oil production.
Because of the rapid socio-economic and cultural development in Russia and the growth of its population (from 26.7 million in 1800 to 50 million in 1870), there appeared an acute need for high-quality and high-efficiency lighting materials.
Regrettably, Russian historiography contains no study of the state and development of the country's lighting materials market in the 19th century. This fact, perhaps, made it possible for Daniel Ergin, a noted American researcher, to assert in his book called “The Prize” that back in 1862, when American kerosene reached Russia, it became widely popular in St. Petersburg where kerosene lamps at once replaced fat candles on which the city's population had been entirely dependent.
While the author is right about the start of the American kerosene expansion to Russia in the 1860s, he is completely wrong about the use of fat candles by the entire population of the city.
By then, for over 140 years already, the streets of the Russian capital had been lighted by oil lamps, and so had the citizens' homes. In 1720 Peter I, a great reformer, personally approved the production of a standard-type street lamp designed by the “master mechanic” Ivan Petling. Before long, 595 street oil lamps were manufactured and installed at 50-sazhen intervals (one sazhen is equal to 2.16 m) near the Winter Palace and the Admiralty. The duration of the lighting season was from August 1 to April 22. Burned in those lamps every year were 1,511 poods of hempseed oil and 213 poods of cotton wick, which cost the treasury 21,456 rubles and 40 copecks.
As early as in the first quarter of the 19th century there were over 4,000 oil-burning street lamps in the capital of the Russian Empire. Furthermore, established there in 1835 was the St. Petersburg Gas Light Company which built at the Obvodnoy Canal the country's first gas works, and by 1839 the city's streets were lighted by 200 gas lamps.
In 1856 a second gas works was built at the Obvodnoy Canal, and a third such enterprise was constructed in Levashovsky Prospect in 1860. In the early 1870s as many as 7,005 gas lamps illuminated the streets of St. Petersburg. For the most part, in the Russian cities the interior of homes was lighted by oil lamps of various designs. Also widely used were stearin and paraffin candles which were far superior to fat candles.
And so, the above-mentioned statement by an American researcher who asserted that before 1862 St. Petersburg was lighted solely by fat candles is a mistake typical of many Western historians who regarded 19th-century Russia as a socially and technically backward country.
Pennsylvanian kerosene in St. Petersburg and Moscow
In the early 1860s the City Administration of St. Petersburg decided that the lighting of the streets with spirit and oil lamps was “unprofitable to the city” and announced a contest for a new type of lighting.
Suggestions came from three contenders: an American citizen named Laszlo Sandor, director of the Mineral Lighting Company, a merchant named Bregman, and the Noble & Co trading house. A commission of six members of the City Duma (Council) was set up to evaluate the suggestions. The testing of new lamps was started on January 10, 1863, and continued until May 1. Eventually, the City Duma opted in favor of Laszlo Sandor whose lamp installation price was the lowest – 34 rubles per large-size lamp and 29 rubles per small-size one. Thereupon, a contract was signed with him for the two lighting periods between August 1, 1863, and May 1, 1865.
His project involved no great outlays for the city: the American businessman agreed to use the old hand carts with metal boxes, ladders and portable lanterns. The oil- and spirit-burning lamps were converted into kerosene ones. In the evening of August 1, 1863, as many as 6,000 kerosene lamps were burning in the streets of St. Petersburg, and soon their number reached 7,200.
In an attempt to keep up with the capital, the Moscow City Council, in the autumn of 1863, announced a bid for the installation of a kerosene street-lighting system. The bid was won by a Frenchman named Fabius Boital. He contracted to install 2,200 kerosene lamps, and from May 1, 1865, Moscow began to be lighted exclusively with kerosene. Before long, the number of kerosene lamps in the city was brought to 9,310. At first, half-inch wicks were used in them and later, from 1875 on, one-inch ones.
The wide use of kerosene as a new street-lighting material both in the capital and other Russian cities was due to a number of factors. In the first place, kerosene produced bright and even light; in fact, its luminosity was greater than that of either hempseed oil or the spirit-and-turpentine mixture. But even more important was the fact that kerosene was less expensive. An efficient marketing policy pursued by the American companies was also an important factor: at the initial stage they even gave customers low-priced kerosene lamps free of charge.
The example of how street lighting with kerosene was organized in Petrozavodsk, a remote provincial city, is quite characteristic. In 1864 the Petrozavodsk City Duma instructed one of its members, named Zhdanov, to find a master mechanic capable of converting 41 oil lamps to the use of kerosene and of repairing “the lamp-lighting ladders”. For a sum of 143 rubles, master mechanic Popov fulfilled the order, and from then on street lighting with kerosene became customary in Petrozavodsk.
Moreover, kerosene lighting became widespread in the railroad and water transport as well as at various educational and cultural establishments, medical institutions, small factories and workshops.
In the 1850s and 1860s telegraph communication became really far-flung in Russia. In 1852 a telegraph line was built between St. Petersburg and Oranienbaum, and later – between St. Petersburg and Moscow. Built in 1854-1855 were telegraph lines between Moscow, Kiev and Odessa, between St. Petersburg, Revel and Helsingfors, as well as between the city of Kovno and the Prussian border. Later on the construction of telegraph lines continued both westwards and eastwards. And kerosene lamps provided high-quality lighting needed by the telegraph operators who were required to work round the clock.
Russia's reply to America's challenge
For a number of reasons Russia's oil industry could not satisfy fully the requirements of the domestic market in kerosene.
In all, in 1870 Russia produced 1,704,455 poods of crude oil, in 1871 – 1,375,523 poods, and in 1872 – 1,535,981 poods. Also, in 1870 Russia produced 389,100 poods of kerosene, while in 1871 its output totaled 494,000 poods, and in 1872 – 524,000 poods. At the same time, the import deliveries of kerosene were as follows: 1,441,000 poods in 1870, 1,720,000 poods in 1871, and 1,793,200 poods in 1872. The bulk of the imported kerosene in 1872 came from North America, and only 0.03% (62,000 poods) – from Galicia and Romania.
This means that at the time the share of imported kerosene was quite considerable: in 1870 it totaled 78.73%, in 1871 – 77.69%, and in 1872 – 77.38%.
It cannot be said that the Russian industrialists regarded calmly America's kerosene expansion. For obvious reasons, they were not going to play the role of mere observers at the highly-promising and rapidly-developing market of lighting materials.
At the 1865 manufactured goods fair in Moscow the greater silver medal was won by the Transcaspian Trading Company headed by Vasily Kokorev and Pyotr Gubonin. The company presented a lighting material it called “photonaphthyl” which had been obtained during the distillation of Baku oil at the Surakhany Refinery. The material was described as being “of white color and purer than the imported Pennsylvanian oil, which burned just as well as the best brand of that oil.”
The minor silver medal at the fair was awarded to “photogen”, a dry-distillation product obtained at the refinery owned by Sergey Maltsev, a retired major-general.
The magazine “Technical Digest” described the above-mentioned exhibits in the following way: “The photogens and machine lubricants (1.5 rubles and three rubles per pood, respectively) presented by Mr. Maltsev of the Zhizdra Uezd, Kaluga Guberniya, which were obtained from the local lignites, should be regarded more as products of experimentation than of established production – especially in view of the fact that the photogen does not have to compete with the American mineral oil or the Baku photonaphthyl which is still priced too highly (from five to six rubles in Moscow) by the monopoly called Transcaspian Trading Company.”
Clearly, such a high-priced lighting material produced on the Apsheron peninsula could not, under the antiquated tax-farming system, compete successfully with the low-priced mass-produced American kerosene. This fact was aptly noted by the above-mentioned magazine which wrote: “Considering that Pennsylvania, one of the North American states, in 1862 produced up to two million poods of mineral oil and that this refined oil costs about three copecks per pound in American ports, the company's efforts to maintain such a high price of a similar product may prove futile without the intervention of the Customs Office.” However, no intervention on the part of the Russian government in favor of the monopoly followed, since the country's economy needed large quantities of low-priced, high-quality lighting material.
And so, the way for American kerosene going to Russia was completely unhampered. It was no accident that in his report the American consul in St. Petersburg said that in all probability the United States could count on a large annual increment in demand for its produce for several years to come.
It was only the abolition of the tax-farming system at the oil fields of the Apsheron peninsula in February 1872 and the achievements of Russian oil business that created real conditions, first, for competition in the quality and prices of Russian and imported American kerosene, and, second, in the complete ousting of the latter from the Russian market by the year 1883.
In the second half of the 19th century Russia's oil industry became a field worthy for the application of the creative efforts of both native and foreign businessmen. Their constructive activity played an important part in the accelerated development of the Russian petroleum industry and in its attaining leading positions in the world's oil production by the end of the 19th century.