But before we get into more detail about the company as well as the global industry pertaining to oil refining, first let’s try to understand what oil refining actually is. Most of you must know that oil is found beneath the surface of the earth and is extracted through onshore and offshore drilling platforms. However, the oil which is extracted is in its natural form not really usable for products such as kerosene, lubricants and fuels. This is where oil refining comes in.
Oil refining is a major activity which involves in turn, several major processes. Oil refining takes place in an oil refinery and the processes include distillation, coking, cracking, reforming as well as post treatment and the refining of products. This process in turn requires a lot of thermal energy and also results in the release of a lot of carbon dioxide and if you’ve learned anything at all related to climate change and what has been causing it, you will know this is not a good thing. The release of CO2 in the air is one of the leading factors of climate change and the oil refining industry has come into fire a lot over the past several decades, but even more so now that awareness is spreading and the effects of climate change aren’t just being talked about but are also being felt as well. Petroleum refineries alone each year release around a billion tons of CO2 which makes up 4% of the total global emissions, and is a completely unstainable number. And in developed countries which can afford to focus on these issues, news rules and regulations have been passed over the several years to make businesses more environmentally friendly and to reduce greenhouse gas emissions to limit the effect of climate change. This has caused a dent in the oil refining industry but this has been more than offset by increased production in developing economies, where rules and regulations are much more lax. And despite these rules, the biggest oil companies have the resources to flout them and escape any serious repercussions. After all, even a fine of a few million dollars is nothing for a company which earns hundreds of billions of dollars in revenue each year. There is a reason why the biggest oil refining companies in the world are also among the companies which are the biggest polluters in the world.
While it may seem to be a simple industry, the refining of crude oil is quite complex and complexities have been increasing over the years, with new challenges cropping up, including lower quality of crude oil which can include tar sand bitumen, extra heavy oil and heavy crude oil. Other issues that the industry is facing are the volatile crude oil prices with the volatility increasing earlier in 2020 when Russia and Saudi Arabia engaged in a price war over oil which decimated the prices and combined with the pandemic, actually resulted in negative future contracts for oil for the first time in history. And of course, as I mentioned earlier, complying with new environmental regulations has also made things tougher, with focus required on clean manufacturing processes and reduced emissions, which can be quite expensive and hit the operating expenses of a company. This is why the oil refining industry needs to combine with the tech industry and come up with a solution that will be both cost effective and able to achieve all requirements.
The global oil refining industry has been severely affected by the Covid-19 pandemic, which you may remember affected drastically the prices of oil as demand decreased. This led to a slump in the oil refining industry as well, but is expected to recover in 2021 and post a CAGR of around 1.25% between 2020 – 2025. The biggest oil refinery markets are Asia Pacific and of course, the Middle East whose entire wealth is based on the vast oil reserves. Asia Pacific is still the biggest market with the capacity of around 100 million barrels every single day and 35% of the global capacity, which is why you will not be surprised to find out the the two biggest oil companies in the world belong to China. It is not surprising the most of the biggest oil companies in the world are in our list too, since these companies are often engaged in all parts of the global oil industry supply chain which includes oil refining as well. These are some of the biggest companies in the world heading into 2021 and together, have a combined revenue of more than $2.7 trillion, profits of over $102 billion, and assets of nearly $3.6 trillion. These companies also provide direct employment to at least 3.2 million people and indirectly to millions more. To calculate our rankings, we have taken the average of the revenues, assets, profits and employees, with all of the data being taken from the Fortune 500 list. So let’s take a look at the biggest companies responsible for the global supply of oil, starting with number 15:
15. ENI
Total revenue of the company in 2019 (in billions of dollars): 79,513
Total profit of the company in 2019 (in billions of dollars): 166
Total assets of the company in 2019 (in billions of dollars): 138,549
Total employees of the company in 2019: 32,053
ENI is an Italian company which is considered on of the seven ‘supermajor’ oil companies in the world, and operates in 66 countries.
Pixabay/Public Domain
14. Phillips 66 (NYSE:PSX)
Total revenue of the company in 2019 (in billions of dollars): 109,559
Total profit of the company in 2019 (in billions of dollars): 3,076
Total assets of the company in 2019 (in billions of dollars): 58,720
Total employees of the company in 2019: 14,500
We have a few American company in our list, starting with Phillips 66, which has activities in a few countries and is one of the oldest countries in our list at 103 years old.
Pixabay/Public Domain
13. SK Holdings
Total revenue of the company in 2019 (in billions of dollars): 86,163
Total profit of the company in 2019 (in billions of dollars): 616
Total assets of the company in 2019 (in billions of dollars): 114,175
Total employees of the company in 2019: 108,911
SK Holdings belongs to the country of South Korea and is comprised of 95 subsidiaries, which engage in various industries which include oil refining as well.
Pixabay/Public Domain
12. Marathon Petroleum (NYSE:MPC)
Total revenue of the company in 2019 (in billions of dollars): 124,813
Total profit of the company in 2019 (in billions of dollars): 2,637
Total assets of the company in 2019 (in billions of dollars): 98,556
Total employees of the company in 2019: 60,910
The American company was established just 11 years ago in 2009, and is headquartered in Ohio.
11. Petrobras (NYSE:PBR)
Total revenue of the company in 2019 (in billions of dollars): 76,589
Total profit of the company in 2019 (in billions of dollars): 10,151
Total assets of the company in 2019 (in billions of dollars): 229,740
Total employees of the company in 2019: 57,983
The biggest oil refining company in Brazil is easily one of the biggest oil refining companies in the world and is one of the biggest polluting companies in the world by far.
Pixabay/Public Domain
10. Chevron (NYSE:CVX)
Total revenue of the company in 2019 (in billions of dollars): 146,516
Total profit of the company in 2019 (in billions of dollars): 2,924
Total assets of the company in 2019 (in billions of dollars): 237,428
Total employees of the company in 2019: 48,200
Chevron is another globally popular company and is one of the successors of one of the biggest companies in history in Standard Oil. Chevron engages in several different aspects of the oil and gas industry including exploration, extraction, refining, marketing and transport.
Ken Wolter / Shutterstock.com
9. Lukoil
Total revenue of the company in 2019 (in billions of dollars): 114,621
Total profit of the company in 2019 (in billions of dollars): 9,895
Total assets of the company in 2019 (in billions of dollars): 95,773
Total employees of the company in 2019: 101,000
The second biggest oil refining company in Russia is the biggest non-state company there as well. It was only founded 29 years ago in 1991.
Pixabay/Public Domain
8. Reliance Industries
Total revenue of the company in 2019 (in billions of dollars): 86,270
Total profit of the company in 2019 (in billions of dollars): 5,625
Total assets of the company in 2019 (in billions of dollars): 154,196
Total employees of the company in 2019: 195,618
Reliance Industries is the biggest company in India and has made its owner Mukesh Ambani incredibly rich. While the company is engaged in many industries, oil refining is one of the industries in which the company has a major stake.
stockphoto mania/Shutterstock.com
7. BP (NYSE:BP)
Total revenue of the company in 2019 (in billions of dollars): 282,616
Total profit of the company in 2019 (in billions of dollars): 4,026
Total assets of the company in 2019 (in billions of dollars): 295,194
Total employees of the company in 2019: 72,500
BP is perhaps still infamous due to causing the worst oil spill in history in 2010, the Deepwater Horizon spill, but is still a major oil refining company and the biggest in the UK.
sergspb / Shutterstock.com
6. Rosneft Oil
Total revenue of the company in 2019 (in billions of dollars): 96,313
Total profit of the company in 2019 (in billions of dollars): 10,944
Total assets of the company in 2019 (in billions of dollars): 208,549
Total employees of the company in 2019: 335,000
The second of two Russian companies in our list is Rosneft Oil, which is owned by the Russian government and is involved in several industries within the oil sector, including oil refining.
5. Total (NYSE:TOT)
Total revenue of the company in 2019 (in billions of dollars): 176,249
Total profit of the company in 2019 (in billions of dollars): 11,267
Total assets of the company in 2019 (in billions of dollars): 273,294
Total employees of the company in 2019: 107,776
The biggest oil refining company in France is active in several countries across the globe and is considered one of the major oil companies in the world.
Pixabay/Public Domain
4. Exxon Mobil (NYSE:XOM)
Total revenue of the company in 2019 (in billions of dollars): 264,938
Total profit of the company in 2019 (in billions of dollars): 14,340
Total assets of the company in 2019 (in billions of dollars): 362,597
Total employees of the company in 2019: 74,900
ExxonMobil has been accused of funding climate change deniers, and when you’re one of the biggest oil refining companies in the world, such unethical activities are just part and parcel of the business you’re in. It is it the biggest oil refining company in the US.
Barry Blackburn / Shutterstock.com
3. Royal Dutch Shell (NYSE:RDS)
Total revenue of the company in 2019 (in billions of dollars): 352,106
Total profit of the company in 2019 (in billions of dollars): 15,842
Total assets of the company in 2019 (in billions of dollars): 404,336
Total employees of the company in 2019: 83,000
Shell is one of the most well known oil and gas companies in the world, and the biggest company by far in the Netherlands, and used to be the biggest company in the world back in 2013. It maintains a presence in at least 70 countries across the world and has more than 44,000 service stations across the globe.
Pixabay/Public Domain
2. Sinopec Group (NYSE:SNP)
Total revenue of the company in 2019 (in billions of dollars): 407,009
Total profit of the company in 2019 (in billions of dollars): 6,793
Total assets of the company in 2019 (in billions of dollars): 317,516
Total employees of the company in 2019: 582,648
The third biggest company in the world by revenue just misses out on top spot and apart from oil refining is also engaged in oil exploration and petrochemicals production. The company was established 21 years ago in 2000.
Pixabay/Public Domain
1. China National Petroleum
Total revenue of the company in 2019 (in billions of dollars): 379,130
Total profit of the company in 2019 (in billions of dollars): 4,443
Total assets of the company in 2019 (in billions of dollars): 608,086
Total employees of the company in 2019: 1,344,410
By revenue, it is the fourth biggest company in the world, but it easily tops the list of the 5 biggest oil refining companies in the world. It was established 33 years ago in 1988, and is of course headquartered in Beijing. As is true for most huge Chinese companies, China National Petroleum is state owned and operated by the government. It has operations across the world including in Asia, Africa, Europe, and Oceania, and has been responsible for several oil spills which have garnered negative press for the company.
anekoho/Shutterstock.com
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This article is originally published at Insider Monkey.