ABSTRACT
The Texas Railroad Commission (TRC) is a state regulatory agency established in 1891 to protect consumer interests in rail travel. The TRC used its regulatory authority to help major oil firms negotiate what were seen as fair and equitable proration agreements. The early failures and later successes of the TRC reveal several key lessons for Organization of the Petroleum Exporting Countries (OPEC). OPEC improved on American cartel practices and experiences. The success of OPEC’s advances was proven in 1973, when OPEC countries exerted their control over exports and production to unilaterally raise the price of oil without the agreement of the international oil companies who produced and distributed that oil. The TRC’s efforts were futile in the absence of inter-state trade regulation. Until the federal government stepped in to regulate the interstate oil trade, attempts at controlling production within Texas could not work.
