History of oil in California through 1930

The story of oil production in California began in the late 19th century. In 1903, California became the leading oil-producing state in the US, and traded the number one position back-and forth with Oklahoma through the year 1930. As of 2012^[update], California was the nation's third most prolific oil-producing state, behind only Texas and North Dakota. In the past century, California’s oil industry grew to become the state’s number one GDP export and one of the most profitable industries in the region. The history of oil in the state of California, however, dates back much earlier than the 19th century. For thousands of years prior to European settlement in America, Native Americans in the California territory excavated oil seeps. By the mid-19th century, American geologists discovered the vast oil reserves in California and began mass drilling in the Western Territory. While California’s production of excavated oil increased significantly during the early 20th century, the accelerated drilling resulted in an overproduction of the commodity, and the federal government unsuccessfully made several attempts to regulate the oil market.

Native Americans were keenly aware of oil reserves in California, and they relied on its utility for thousands of years, albeit not for energy sources. The most abundant oil seep in the ancient California territory was the La Brea tar pits, in present-day Los Angeles. Native Americans used oil from La Brea and other seeps primarily as a lubricant, but they also used it as a sealant to waterproof canoes. When Spanish explorers arrived in California in the 1500s, they also used oil to seal cracks in their ships and the roofs of their homes.

In 1865, seven years after Edwin Drake developed the first oil drilling system in North America—located in Pennsylvania—Union Mattole Company started producing oil in the Mattole Valley near Petrolia, California. Union Mattole Company hoped to replicate the success of the Pennsylvania drillings and find large amounts of oil in Northern California. During this period, California’s population increased by approximately 375% in the years following the 1849 gold rush, and California’s demand for oil was increasing dramatically. However, Union Matolle failed to find sufficient oil supplies. The company could not produce the oil to keep up with consumer demand. As a result, Californians found themselves in desperate need of oil.

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