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Why does Houston has the most oil companies in the United States?

by tom44 on April 30, 2013

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Question by Naro: Why does Houston has the most oil companies in the United States?
Is that because Houston is the largest city around the Gulf Coast which is the main source of oil in the US?

Best answer:

Answer by sophieb
Recently we found out that there is oil underneath the soil in many parts of the USA but in years past it was the Texas oil fields that became known and popular. I think it’s North Dakota that now has oil as well.

What do you think? Answer below!

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One thought on “Why does Houston has the most oil companies in the United States?

  1. Drew H says:

    At the turn of the 20th century, Oklahoma was the capital of the oil industry. However, when the Spindletop field was discovered in Beaumont, TX (on the outskirts of Houston) in 1901 the Texas Oil Boom began. Oil companies started exploring around Houston and kept finding huge oil fields around Houston. Naturally, they started sending people down there to run the fields and they all ended up living in Houston. At the same time, the oil fields in Oklahoma were dying out. Also, all of the major oilfield services industries relocated to Houston to be close to the action and the port of Houston (3rd largest port in the USA) so that could obtain raw materials easily. By the 1950’s most major oil companies either had relocated to Houston or had major offices in Houston where real estate was far cheaper than in the east. By the 1960’s, the industry was starting to explore the Gulf of Mexico off of Texas and Lousiana. This cemented Houston as the headquarters of the oil industry. Over the last 30 years with the rise of telecommunications and the internet, fields from around the world can be run remotely, so companies stayed in Houston. All of this snowballed over the years as the cost of living and operating in Houston is so much cheaper than anywhere else in the USA. At the same time, the industry becam very regionalized where all of the employees were from the south, the only school that offer degrees tailored for the oil industry are in the South, and all of the jobs are in the South.

    In the end, it just makes sense for all of the companies, both operator and service companies, to be located in the same city. Houston became the 4th largest city in the US because of the oil industry. In 1900 Houston was small.

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