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Sunday, December 17, 2017

Three oil companies among the ten biggest companies in the world

The Financial Times (FT) has updated its FT Global 500. Among the 10 biggest companies in the world, there are 3 oil companies. The biggest company in the world is General Electric with a market value of USD 382 bn, 2nd is Exxon Mobil, which has a market value of USD 381 bn, 3rd is Microsoft with USD 263 bn, BP is 4th with USD 221 bn and 7th is Shell with USD 211 bn. All the oil companies have climbed upwards since 2004, Exxon Mobil from 3rd position, BP from 9th and Shell from 13th position. Among the 100 largest companies we find another 5 oil & gas companies, Total 14th (up from 23rd ), ENI 29th (up from 42nd), Chevron Texaco 24th (up from 31st ), Conoco Philips 47th (up from 94th ), and Gazprom 58th (up from 77th ). 

During the past year, skyrocketing oil prices have helped the value of ExxonMobil level-peg and sometimes overtake that of General Electric (GE). In the list, GE’s value of USD 382 bn is just USD 1 bn larger than ExxonMobil - less than half a per cent. In size at least, the two mammoths of the corporate world are locked in battle. 

The Financial Times claims that it is not just about size. They are both claiming the high ground when it comes to the biggest issue of the moment - oil. Expensive oil, and the debate on how to respond to it, is exercising the global giants like never before, in the absence of large transformational mergers or breathtaking innovations such as the Internet. In an advertising campaign last month, ExxonMobil argued that there would be few alternatives to the use of fossil fuels over the next 25 years.  

In a rugged, typically Texan, counterpoint to BP's eco-friendly ‘Beyond Petroleum’ slogan, ExxonMobil has dug in its heels. "Up to 2030 and beyond, demand will be met predominantly by oil and natural gas," it says. GE’s chairman and chief executive, Jeffrey Immelt, had a different message when launching his "Ecoimagination" campaign, which aims to double spending on green technologies in the next five years. He talked of a world awash with business opportunities for developers of alternative energy sources, even in gas-guzzling America and China. "With oil at UDS 55 a barrel, you have to root for me," he says. 

As a comparison the tanker company Frontline has a market value of some USD 3 bn at the Oslo Stock Exchange, whereas the company in 500th place on the FT list has a market value of some USD 17 bn.  

It is the 73 banks that form the biggest single sector in FT Global 500 with a market value of some USD 3,129 bn whereas the market value of the 32 oil and gas companies in FT Global 500 is some USD 1,761 bn. 

Contact: Erik Ranheim