[Vision2020] Petroleum Intelligence Weekly: Pemex Below Exxon & Chevron, etc.

[Tbertruss at aol.com]

Phil et. al.

Phil wrote on 8/18/05:

"PEMEX or Aramco are doing one heck of a lot better than Exxon or Chevron, 
because they simply own more oil and produce more oil than do the down streamers 
like the US oil 
firms have become."

"So who is 'making money'?  The big winners are the top exporters, Saudi 
Arabia, Russia and Norway and the big losers are the USA, Japan and China 
since they import the largest amount of fuel." 

You are at least partly incorrect in your assessment that Pemex and Aramco 
are doing "one heck of a lot better" than Exxon or Chevron, depending on how you 
measure the complex set of variables involved.  I am not sure why you say the 
"big losers are the USA..."  To find the "big losers" in the USA in the world 
marketplace for oil profits we must examine the "big losers" among US based 
oil corporations, the problem being they are not such "big losers."  

I suppose you could say that the US consumers of gasoline, diesel, home 
heating oil, etc., are the "losers," but Exxon/Mobil and Chevron/Texaco are 
certainly not.  However, the US economy features the largest base of consumers in the 
world with disposable income to spend on gasoline, etc., so perhaps they are 
not "losers:"  the profits generated by a gigantic corporation like 
Exxon/Mobil are recycled in our economy to some extent, though I think the "trickle 
down" theory of corporate profits used to justify tax cuts and breaks has some 
serious faults insofar as this approach offers real benefits to the lower 
classes.  However, are not the stock holdings of US citizens in the highly profitable 
and gigantic corporations Exxon/Mobil and Chevron/Texaco a large economic 
factor in the health of the US economy?  How does this make the USA a "big loser" 
in regards to the global oil economy?

Selling huge amounts of oil turned into gasoline can generate huge profits, 
even if the company, such as Exxon/Mobil, is more a "downstream" corporation 
than other "upstream" corporations or state owned operations, such as Aramco.  
And Exxon/Mobil leads the world in refining capacity at number one, resulting 
in Exxon/Mobil having control over more refined gasoline, thus their number one 
ranking for product sales, according to the info from PIW.

Data below offered at the web link to PIW lists Exxon/Mobil and 
Chevron/Texaco as outperforming Saudi Aramco and Pemex in several important economic 
variables. The charts at the PIW site, that does list Saudi Aramco, number one, 
above Exxon/Mobil, number two, but lists Pemex as below both Exxon/Mobil and 
Chevron/Texaco in the same rankings, shows that Exxon/Mobil has far more revenues 
than Aramco, but the Saudi oil and gas reserves under control of this state 
owned company induce the creators of this list to place Aramco ahead of 
Exxon/Mobil.

There are numerous variables to measure a corporations performance, and 
various accounting methods employed that can lead to differing results.  Consider 
that the PIW chart listing "Rankings Based On Financial and Other Measures of 
Size" shows BP with the highest revenues at number one on that variable (with 
US based Exxon/Mobil number two and RD/Shell number three, with nearly the same 
figures as BP for revenue, dwarfing all other corporations on the list), 
though they are number six on that chart's overall ranking.  Also note 
Exxon/Mobil's standing as having the highest capacity for oil refining of any 
corporation, and number one product sales, which is part of the key to Exxon/Mobil's 
profits from oil

The charts discussed above can be viewed at this site, and reveal a complex 
set of variables used in the rankings offered:


http://www.energyintel.com/DocumentDetail.asp?document_id=111082

Ted Moffett
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