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The Oil Industry

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Par   •  4 Juin 2012  •  1 180 Mots (5 Pages)  •  1 013 Vues

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Introduction

The petroleum is a very controversial product because of its issues in many fields; it is not only a common consumption good, but also a rare commodity, which a lot of protagonists are ready to fight for. Its repartition is unequal, and his industry is then quite unusual, because in all the fields that petroleum affects (commercial, economical, industrial, geopolitical, environmental…), its represents a real advantage. The petroleum has been exploited since the 1850s in the USA, and has next become a strategic raw material both for the petroleum companies and the countries all over the world. The discovering of oilfields in some specific countries as for the Middle East ones has lead to a redefining of the petroleum market and its derivatives (fuel, rubber, chemical product). Nowadays, all the components of petroleum are used and consumed. We can say that for the moment development calls for petroleum. Transportation and companies functioning make the petroleum important for all countries and a lot of industries. As for illustration, the two oil shocks demonstrate the dependence of the world to the petroleum industry.

I/ The current situation

1) The consumption

This graphic represents the consumption and the production of petroleum (in number of petroleum barils), by the supply and demand, since 1999 until nowadays. We can easily see that the supply and the demand keep increasing for the last 12 years.

The main consumer countries are: the United States, China, Japan, India, Russia, Saudi Arabia, Germany, Brazil, South Korea, Canada, Mexico, France, Iran, United Kingdom and Italy. Between 2007 and 2009 the petroleum consumption has decreased in the OECD countries (-4,8% in 2009) because of the price of the petroleum, which increases a lot when the world has to face economic crisis. Nevertheless the huge consumption of China and India has a real impact on the evolution of the demand; in 2011 China has become the first consumer in energies, in front of the United States.

2) The production

The production of petroleum keeps growing since 1950. It both represents a real advantage for the countries and a delicate issue to manage because of its precious nature, and what it represents in terms of development, exportation, and economical aspect. The most productive ones are Russia, Saudi Arabia, the United States, Iran, China, Canada, Mexico, the United Arab Emirates, Iraq, Kuwait, Venezuela, Norway, Nigeria and Brazil. As far as these countries are concerned we can observe that the producers are not the consumers. It reveals the geopolitical involvement at stake in the petroleum business; nowadays some countries export their petroleum because it constitutes major revenue (Russia). Some others keep their reserves (USA, China). The petroleum production is made by Multinational, big companies, that dispose of the necessary equipment and financial founds.

The 10 biggest producer of petroleum in 2009 (source: Ladocumentationfrançaise.fr)

Country Reserves Production Consumption Exportation

Russia 77,4 10,032 2,695 7,337

Saudi Arabia 264,5 9,713 2,614 7,099

USA 30,9 7,196 18,686 -11,049

Iran 137 4,216 1,741 2,475

China 14,8 3,790 8,625 -4,835

Canada 32,1 3,212 2,074 1,138

Mexico 11,4 2,979 2,056 0,923

United Arab Emirates 97,8 2,599 0,236 2,363

Iraq 15 2,482 0,770 1,712

Kuwait 101,5 2,481 0,307 2,174

II/ The oil companies’ power

1) The “big oil”

In 2006, among the 10 biggest private societies in the world, 5 are oil companies. Now there are also many national companies, which represent a mainstay for the whole petroleum industry, and for the world economy.

Different kinds of companies currently exist.

The multinational private companies have most of the time a vertical integration strategy. These are called “majors”. They are the oil industry leaders.

Ex: Exxon Mobil, Shell, BP, Total and Chevron

The refiner companies are the owners of the refineries and sometimes the oil stations (ex: Petroplus), whereas the independent companies search and sell the brut product. These can have very different sides; from the biggest that search on many countries (ex Anadarko) to the little family companies which just have one or two oil wells.

Finally, the national companies can have a very important impact on the national

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