Revenue from the oil and gas corporation is expected to reach $5 trillion worldwide by 2022, making it one of the world’s most lucrative industries. Some observers have noted that the oil and gas companies have entered a revolutionary period of heightened global competition they call the “new oil order.”
National Oil Companies
Since Mexico nationalized its oil production in 1938, governments have founded private state-owned firms or acquired significant shares in publicly listed oil companies. The production of oil in Mexico was the first to be nationalized.
Recent moves to nationalize oil businesses have been seen as a political tactic to regulate international oil companies’ access to and influence over national resources, as well as a reaction to such companies’ decades-long abuse of domestic oil reserves.
- For instance, Oil and Natural Gas Corp Ltd (ONGC) is an excellent example of an integrated energy corporation because it participates in every stage of the hydrocarbon value chain.
- New Delhi is home to the organization’s headquarters. ONGC was founded as a government-owned company in India on August 14, 1956.
- Its activities include oil and gas prospecting, extraction, processing, distribution, and petrochemical production.
- Pakistan is home to the Oil and Gas Development Corporation Limited (OGDCL), a firm that serves the country’s oil and gas needs.
- Established in 1961 by the government of Pakistan, it became a publicly traded company on October 23, 1997.
- Presently it is engaged in the oil and gas industries of Pakistan, including exploration, drilling, processing, and marketing.
Background of Oil and Gas Corporation
Ancient communities in India, Greece, Persia, northern Iraq, and China kept records of natural gas resources. Some communities put this energy to use by doing things like the inhabitants of the Sichuan Valley did and used it to evaporate salt from brine.
- Technology has increased both the efficiency with which fossil fuels may extract and the number of uses they can put, making petroleum and natural gas increasingly valuable commodities.
- Canada, Mexico, Iran, Trinidad, Saudi Arabia, and Venezuela all shared time alongside the United States and Russia as the world’s top oil producers in the 19th and 20th centuries.
- As oil exporting nations became more protective of their resources and keen to benefit from the lucrative oil sector, the big companies were forced to negotiate deals to ensure they could continue oil extraction.
- After WWII, a system of equal sharing of profits was established; however, oil-exporting countries quickly began nationalizing firms to increase their share of the profits.
- Oil-exporting and importing countries’ political and military instability frequently upset the delicate equilibrium between oil supply and demand.
Top Oil and Gas Companies in the World
Following is a list of the most profitable top oil and gas corporations in the world (refiners and crude producers) according to their trailing twelve-month revenue (TTM).
Kingdom of Saudi Arabia Oil Co. (Saudi Aramco) (Tadawul: 2222)
- The market has 7.5 trillion dollars’ worth of assets, and the total return over the past year has been 17.4 percent.
- Year-to-Date (YTD) Revenue: $1.3 Trillion
- Net IncomeIncome: $330.3 Billion
PetroChina Company, Ltd. is the trading platform (PTR)
- Revenue for the trailing twelve months was $367 billion
- With a market cap of $95.8 billion and a total return on investment of 50.7% over the prior year
- Net IncomeIncome for the last twelve months was $13 billion
China Petroleum & Chemical Corp. (SNP)
- The company has a market cap of $62.3 billion, a one-year trailing total return of -3.6%
- Reported revenues of $353.2 billion in the twelve months
- Net IncomeIncome for the trailing twelve months was $14.3 billion
Exxon Mobil Corp. (XOM)
- Revenue for the trailing twelve months was $280.4 billion
- With a market cap of $325.4 billion and a total return on investment of 47.2% over the prior year
- Net IncomeIncome for the last twelve months was $23 billion
TotalEnergies SE (TOT)
- The company has a market cap of $146.4 billion, a one-year trailing total return of 27.5%
- Reported revenues of $184.6 billion in the twelve months
- Net IncomeIncome for the trailing twelve months was $16 billion
Upstream and Midstream Oil and Gas
Typically, the oil and gas business is broken into upstream, midstream, and downstream sectors. Although there are many separate companies in each industry, many people classify the largest oil and gas corporations as integrated. Company transparency can be affected by whether the company is privately, publicly, or publicly owned.
In the oil and gas industry, companies are often divided into one of three categories:
- Upstream – this sector consists of oil and gas exploration and production
- Midstream – this sector constitutes of oil and gas transportation and storage
- Downstream – this part comprises oil and gas processing into tens of thousands of completed products
Oil and gas companies can be upstream or downstream depending on where they are in the supply chain.
Upstream Oil and Gas Companies
- It covers every aspect of discovering new oil and gas reserves.
- Most of the world’s crude oil production is controlled by national oil companies like OPEC and the other integrated international oil giants.
- This group’s main areas of attention are surface transportation and oil and gas exploitation.
- The term “E&P” firms, which stands for “exploration and production,” is frequently used to refer to upstream companies.
Midstream Oil and Gas Companies
- In this industry, there are numerous distinct kinds of transportation businesses.
- Midstream corporations care about oil and gas quantities and pricing because of the following: There is no need for midstream firms to handle transport if the price is low enough to cause upstream firms to cease production.
- Midstream businesses are responsible for moving crude oil and natural gas from extraction locations to refineries.
- Tanker trucks, pumping stations, intercontinental tankers, and retail tank trains are all part of the system used to deliver these materials over great distances.
As economies and infrastructures everywhere rely heavily on petroleum-based products, the world’s reliance on oil and gas is growing. Upstream oil and gas companies focus on exploration, development, and production Midstream oil and gas companies comprise the supply chain processes of warehousing, processing, and transporting petroleum products.
Frequently Asked Questions (FAQs)
Q1: Can you name the top oil-producing nations?
A: As of 2022, the United States of America, Saudi Arabia, Russia, Canada, and China are the top five countries in net crude oil production, with China trailing far behind.
Q2: How many oil and gas companies are spread throughout the world today?
A: There are probably tens of thousands of separate oil companies spread out across the world. There are around 9,000 independent oil companies in the United States alone. These firms do not have more than $5 million in annual sales or process more than 75,000 barrels of crude oil daily.
Numbering the world’s oil companies is a difficult task. It is mainly because public companies have stricter disclosure requirements than their private and government-owned counterparts.
Q3: Who in America determines the cost of crude oil?
A: The cost of crude oil is the fundamental factor in determining the amount we pay at the pump, which is determined by economic supply and demand forces and not by particular firms.
Q4: Is oil refining considered upstream or downstream activity?
A: The downstream sector is the final step of the procedure and corresponds to the refining, processing, and purification of crude oil and natural gas. This sector also refers to the ultimate stage of the process.
Q5: How do oil firms in the midstream segment make money?
A: Because most of a midstream company’s income comes from long-term, fixed-fee, take-or-pay contracts, in which the counterparty agrees to pay a specific amount irrespective of oil prices or the quantity passed through the infrastructure, this is the case.