It’s really easy to beat on the oil companies. Every time one fills up a gasoline diesel or propane tank, the agony is real. The blame has to go somewhere, and blame aplenty and usually justified was more or less valid. The oil companies were, that is were in the past, actually some decades ago now, accused of being powerful, monopolistic, faking up high prices, stimulating wars and poisoning the planet. Governments all across the world have had for an assortment of reasons, issues to challenge them. However, its all-old history, subject to lots of critical analysis as the emotions over the energy importance and the amount of money was substantial.

Decades ago it was the “Seven Sisters” made up of Standard Oil, Royal Dutch Shell, British Petroleum, Exxon, Chevron, Texaco and Mobil. More than 37 years ago there was some truth in the accusations. The oil companies had 80% of the reserves in their control. But now the last men standing are but four, ExxonMobil, Shell, Chevron, and BP and they have less than 10% of world reserves in their portfolios, all located in free economies.

The cursing has new oil companies to blame. Let’s list them – maybe the press and the politicians can get it right from now on. In fact, you are free and encouraged to correct them anytime with the facts as they actually are now. The past thirty years have built monoliths that the greedy could only dream of in the distant past. The new “villains” are:

  • Saudi Aramco of Saudia Arabia
  • Gazprom of the Russian Federation
  • CNPC of the Peoples Republic of China
  • NIOC of Iran
  • PDVSA of Venezuela
  • Petrobras of Brazil
  • Petronas of Malaysia

And the rest of the OPEC membership which are government entities rather than “companies” as listed here. (Source – The Financial Times)

These companies seem to be carrying a different kind of load, as observed from the practices they use. The needs to preserve and maximize the reserves, drive down the costs, maximize the market share and other practices most everyone in the developed world consider prudent are absent. A different approach is taken – corporate social responsibility – is the practice. Feeding the revenues into social programs and government boosting are the practices most easily seen. But not always, even not much, and if done in part the benefits usually flow to a narrow group at the top of the local society.

If we were thinking there would be education, seeding of enterprises, infrastructure investments, environmental protection and the other parts of a responsible list, we are disappointed. If one would extrapolate the $40 billion that Exxon posted for profits over the past year in their low single digit market share to the more than 80% of the business held by the new villains, there will an incredible amount of money unaccounted for. If you think the uninformed in the developed world are upset with the private oil companies, just watch what happens when the populations of the villainous located companies catch on to the breadth and depth of the corruption going on now.

What are we in the developed world to do?

For myself, if its blaming big free world oil companies – I am not wasting the time. I am looking for their activities in producing fuels and gathering energy. There is good reason to believe that the Big Free Oil Companies are part of our civilization rather than standing apart as much news and reporting implies. They are engaged in alternative energy and fuel production. Everyone that has few years of experience in the business must be seriously alarmed at the rate and costs of which the profitable production is replaced. The best and lowest cost production is simply out of reach. The conundrum is how to get from now to a future with petroleum production at a sustainable rate for a healthy economy while investing in the research and development of the alternatives. It’s not a task for the faint of heart. The risks are just awe inspiring from exploration costs to distribution facilities, there is a lot at stake. They have to answer to the stockholders – that’s us – our mutual funds and 401Ks included.

Yet, Big Free Oil has started to dip into the alternatives, and I can see by this site’s server reports they are watching us too. Being organizations its very hard to pass along praise and easy to criticize them. Organizations are very hard to pin down to a person, which can be a strong quality to manage risk. On the other hand, the management of risk tends to miss opportunities. Even more pernicious is the human traits to avoid seeking risk, avoid things that are syndromes like “not invented here” and others that narrow the views.

That makes it very hard to get to THE person who can answer questions about what we can expect from them. Outside the business looking at the “forest,” we know Big Free Oil is working on the “trees.”

Other than petroleum, what are you guys working on? Is there a plan? Have you rated where the conservation, energy capture, fuel production, and energy storage investments need to go?

I’m convinced that “properly beating up the oil companies” is to ask those kinds of questions. Let’s see. There is every reason to ask as stockholders, employees and customers.

You will note that there isn’t any beating on the new villainous oil companies. There isn’t any point to be made. To them the customers are the targets for exploitation.

The sooner we learn to ask the right questions the sooner the Free World’s Energy Companies will understand their task.


1 Comment so far

  1. wish on February 12, 2012 3:47 AM

    I want to thanks for posting this text without the usual bias that’s therefore prevalent in nowadays’s writings. This content is simple information.

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