National Oil Companies Now Dominate World Oil

National Oil Companies Now Dominate World Oil
National Oil Companies Now Dominate World Oil

The world oil industry is now dominated by national oil companies, particularly in the Middle East, while the old "Seven Sisters," which used to dominate the world market, have been reduced to what Andrew McKillop calls the "Five Anxious Dwarfs."

The graph shows the world's 25 largest oil companies, as compiled by PetroStrategies, Inc, in February 2012. The horizontal axis represents millions of oil equivalent barrels in the companies' reserves. Importantly, this also includes natural gas reserves.

The ownership of oil reserves is totally dominated by the OPEC nations, most of them in the Middle East, represented in green on the chart. The National Iranian Oil Company leads the pack with 310 billion barrels in reserves (about half of this in natural gas). The Saudi Arabian Oil Company is next, followed by Petroleos de Venezuela, the Qatar General Petroleum Corporation, the Iraq National Oil Company, the Abu Dhabi National Oil Company, the Kuwait Petroleum Corporation, the Nigerian National Petroleum Corporation, the National Oil Company of Libya and Sonotrach, of Algeria. Russia's two energy companies, Gazprom and Rosneft, represented in red, are next, followed by PetroChina.

The "oil giants" - the international private companies that once dominated world trade - now all have less than 25 billion barrels of oil equivalent. Represented in white, they are, in order: BP, ExxonMobil, Royal Dutch/Shell, Chevron, and ConocoPhillips. These companies now make most of their money through technology and trading, rather than ownership of oil reserves.

McKillop, by the way, believes that oil is slowly losing market share to other forms of energy and that the national companies' dominance of oil reserves does not mean OPEC will have a stranglehold on the energy market. He points out that while the Western countries depended on oil for 52.6 percent of their energy in 1973, that figure is now only 36 percent. He also maintains that natural gas will play a growing role in world energy and that gas supplies are much more evenly distributed, with the Five Anxious Dwarfs holding on to more than their share.

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