# Oil Market That Sets Gas Prices Began in Western Pennsylvania

> Western Pennsylvania's oil exchange created the market that now sets gas prices across the U.S.
- Title: Oil Market That Sets Gas Prices Began in Western Pennsylvania
- Summary: Western Pennsylvania's oil exchange created the market that now sets gas prices across the U.S. The Oil City Oil Exchange, founded in 1874, established the…
- Keywords: oil city oil exchange, pennsylvania, gas prices, oil prices, western pennsylvania, oil market, strait of hormuz, iran, iranian war, oil crisis, science, ideas
- Source: The Conversation — https://theconversation.com/the-oil-market-that-sets-todays-gas-prices-was-invented-in-western-pennsylvania-292855
- Author: Brian C. Black
- Read time: 1 min
- Topics: oil city oil exchange, pennsylvania, gas prices, oil prices, western pennsylvania, oil market, strait of hormuz, iran, iranian war, oil crisis, science, ideas
## Oil Market Origins
The Oil City Oil Exchange set crude oil prices for the nation during the late 19th century.
## Early Oil Trading
Oil men traded crude oil on streets before formal exchanges existed.
## First Oil Exchange
In 1859, Edwin Drake struck oil near Titusville, Pennsylvania, funding the first oil deals.
## Oil Exchange Building
The Oil City Oil Exchange opened in April 1878 at the corner of Center and Seneca streets.
## Price Setting
Brokers collected 10 cents per barrel from buyers and 5 cents from sellers.
## Market Control
Standard Oil cornered the market by 1895, controlling prices until 1911.
## Modern Oil Prices
Today, gas prices follow oil prices set by traders on New York Mercantile Exchange and Intercontinental Exchange.
## Iran War Impact
Iranian airstrikes on Feb 28, 2026, closed the Strait of Hormuz, raising global oil prices.
## Key takeaway

The Oil City Oil Exchange, founded in 1874, established the oil market that determines today's gas prices.