NEW YORK (TheStreet) -- About 150 years ago a wholesale grocer from Cleveland took a business trip. You could now drive the distance in just a few hours, and the grocer was determined to see the market circus. He was appalled by what he found.

It was the first oil boom. The government needed kerosene for lamps and paraffin for bullets to bring southern states back into the Union. The entrepreneurs of Oil City, Pa., and the surrounding area were supplying it by pouring oil into whiskey barrels, piling them high onto horse-drawn carts, and then whipping those horses in a frantic effort to reach tiny refineries that could turn the oil into something useful.

It was filthy, it was dangerous, and the grocer saw it was incredibly inefficient. As you may have guessed by now, the grocer's name was John D. Rockefeller, he was a Union man and an abolitionist. His trip taught him that pure capitalism -- red in tooth and claw -- was not going to eliminate that waste.

So, as biographer Ron Chernow wrote in Titan, he took control. Rockefeller organized the railroads against the entrepreneurs and eventually built a pipeline to get crude to scaled, coastal refineries at maximum efficiency. It was secretive, it was a monopolistic "trust" and not a market process, but it worked. Costs declined and profits were maximized.

We are now going through another oil boom, and Rockefeller would find its problems familiar. In North Dakota's Bakken field a third of the natural gas coming up with the shale oil there is being flared, reports the Oil and Gas Financial Journal. That means it's burned at the wellhead, and as a satellite image from the Christian Science Monitor shows, the flaring is visible from space. The U.S. is now wasting more natural gas than any other country.

A smaller-scale problem exists in Texas' Permian basin, where notes there isn't enough pipeline capacity to get all the new oil to market. Local prices were almost $10/barrel below the world price in November, according to Oilprice, costing producers $1.2 billion/year.

The transport problem is even worse in Canada's "oil sands" play. reports that, due to a lack of infrastructure, oil produced by strip-mining bitumen and processing it is now bringing just $45/barrel, about half what Texas oil is fetching.

So, WWRD -- What Would Rockefeller Do?

He would probably shut in production until he had proper infrastructure to get it to market, and support an even-higher price for crude than we presently have. He would probably be in control of some of these pipeline companies, like Kinder Morgan ( KMI - Get Report), TransCanada ( TCP - Get Report) and Enbridge, which is traded in Toronto as ENB.

He would be keeping that oil off the market until politicians let him get pipeline capacity out there. And he would be ruthless with the smaller operators who are flaring all that money into the sky, probably by controlling railroads such as the Canadian Pacific ( CP - Get Report), which Seeking Alpha calls a good investment.

Unfortunately, Rockefeller is dead. The things he did in the 19th century are now said to be illegal. Politicians lack the will to push out the pipelines over environmental objections, and the power to make oil operators wait for them.

In the face of its latest boom, the oil industry looks as helpless as ever to control its greed in the name of efficiency, and billions of dollars are being flared into the sky.

If this is the market, maybe profit needs a cartel instead.

At the time of publication the author had no position in any of the stocks mentioned.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.