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The term supermajor illustrates the six largest energy companies, as seen in popular financial mediums around the world. Trading under various names around the world, they are considered to be:

• ExxonMobil (XOM)
• Royal Dutch Shell (RDS)
• BP (BP)
• Total S.A. (TOT)
• Chevron Corporation (CVX)
• ConocoPhillips (COP)

As of December 1, 2006, ExxonMobil ranks first in size (market capitalization), cash flow (12 months), revenue (12 months), and profits.

Big Oil

Supermajors are sometimes collectively referred to as Big Oil, a pejorative term used to describe the individual and collective economic power of the largest oil and gasoline manufacturers, and their perceived influence on politics, particularly in the United States. Big Oil is often associated with the Energy Lobby.

Usually used to represent the industry as a whole in a pejorative or derogatory manner, "Big Oil" has come to encompass the enormous impact crude oil exerts over first-world industrial society. Additionally, "Big Oil" is also utilized to discuss the consumer relationship with oil production and petroleum use, as consumers in the United States and Europe tend to respond to petroleum price spikes by purchasing vehicles with greater fuel efficiency during these periods. Historically, consumer interest in fuel efficiency and the oil debate wanes significantly as pump prices stabilize.

Controversy

Main article: Oil price increases of 2004-2006

In 2005, the term Big Oil has been used regularly in the media as the United States pump price for regular unleaded gasoline passed $2.00 U.S., then $3.00 U.S. in early autumn. The critical increase in fuel cost has been attributed to the effects of Hurricane Katrina and Hurricane Rita, in addition to the increasing costs of crude oil on world markets resulting from the uncertain status of supply, political instability in the Niger River Delta, and the ongoing Iraq War. The phase-out of MTBE for ethanol is another factor during 2006 - some parts of the U.S. were selling regular unleaded for $3.27/gallon - especially in West Coast states. As of May 2007, the national average is around $3.15/gallon (where oil is trading @ $66/barrel).

A current issue is whether the petroleum industry has engaged in profiteering during a time of catostrophic weather events and political unrest. The oil industry has responded by outlining their extensive costs, market uncertainties and public education efforts with regard to industry background, supply and demand, and how the system of commodity futures affects pricing. Industry supporters and many fiscal conservatives have supported the industry as an example of free market economics. Industry detractors have focused on specific profit reports and attempted to outline allegations that the oil industry has utilized unrest to achieve unjust enrichment.

The Republican Party of United States is often criticized for giving tax breaks to Big Oil [1][2][3]. By some accounts, past support of Big Oil was one reason many Republican members of the United States Congress were defeated in the 2006 election [4][5].

The Seven Sisters

Today's Supermajors also comprise many of the companies that at one point made up the Seven Sisters. The Seven Sisters term was coined by an Italian entrepreneur, Enrico Mattei, that refers to seven oil companies that dominated mid 20th century oil production, refinement, and distribution. They consisted of three companies formed by the break up by the U.S. Government of Standard Oil, along with four other major oil companies. With their dominance of oil production, refinement and distribution, they were able to take advantage of the rapidly increasing demand for oil and turn immense profits. Being well organized and able to negotiate as a cartel, they were able to have their way with most Third World oil producers. It was only when the Arab states began to gain control over oil prices and production, mainly through the formation of OPEC, beginning in 1960 and really gaining power by the 1970s, that the Seven Sisters' influence declined.

These companies were the following:

1. Standard Oil of New Jersey (Esso), which merged with Mobil to form ExxonMobil.
2. Royal Dutch Shell Anglo-Dutch
3. British Anglo-Persian Oil Company (APOC). This later became BP, then BP Amoco following a merger with Amoco (which in turn was formerly Standard Oil of Indiana). It is now known solely by the initials BP.
4. Standard Oil of New York (Socony). This later became Mobil, which merged with Exxon to form ExxonMobil.
5. Standard Oil of California (Socal). This became Chevron, then, upon merging with Texaco, ChevronTexaco. It has since dropped the 'Texaco' suffix, returning to Chevron.
6. Gulf Oil. In 1985 most of Gulf became part of Chevron, with smaller parts becoming part of BP, and Cumberland Farms, in what was at that time the largest merger in world history. A network of stations in the northeastern United States still bears this name.
7. Texaco. Merged with Chevron in 2001. The merged company was known for a time as ChevronTexaco, but in 2005 it changed its name back to Chevron. Texaco remains as a Chevron brand name.

The Seven Sisters is the title of a book by British journalist Anthony Sampson about the history of the oil industry, published in 1975.

As of 2005, the surviving companies are ExxonMobil, Chevron, Shell, and BP.

On 11 March 2007, the Financial Times identified the "new seven sisters": the most influential and mainly state-owned national oil and gas companies from countries outside the OECD. They are Saudi Aramco, Russia’s Gazprom, CNPC of China, NIOC of Iran, Venezuela’s PDVSA, Brazil’s Petrobras and Petronas of Malaysia.

See also

• Price gouging
• Cartel
• Fossil fuel
• Monopoly
• Petroleum