| Compared to IOCs (InterNational oil companies) like BP, | | | | successful in the early years in some countries, as |
| ExxonMobil, or any of the 'Big Oil' companies, the | | | | they provided jobs to thousands of people in upstream |
| NOCs dominate global reserves of crude oil and | | | | and downstream industries, the general performance |
| natural gas. The dominance of National oil companies | | | | of many NOCs has proved disappointing. A |
| has seen a dramatic increase in recent years and they | | | | Comparison with IOCs has shown that the NOCs tend |
| have also started investing in exploration and refining | | | | to be less efficient and less profitable and more prone |
| not only within their national borders, but in other | | | | to political pressures and influence, including corruption. |
| countries too. National oil companies or NOCs have | | | | Politicians in many countries use NOCs to provide jobs |
| control over a very large share of global crude oil and | | | | to their favorites and supporters as a reward. In many |
| natural gas resources, either as actual oil producers, or | | | | countries, these politicians also controlled, directly or |
| as custodians of a natural national resource. IOCs are | | | | indirectly, the financial sector; the NOCs received bank |
| given exploration and exploitation rights and access by | | | | loans at heavily subsidized rates of interest. Despite all |
| the NOCs and the national government. | | | | this, every country needs National oil companies to |
| Additionally, an approximate 60 to 65 percent of | | | | safeguard its natural resources. |
| undiscovered crude oil and natural gas reserves are | | | | The recent volatility in crude oil prices, along with global |
| estimated to be in countries where the NOCs have | | | | recession, and an uncertain world economy makes it |
| sole privilege and access to the reserves. This means | | | | very difficult to define a long-term perspective and |
| that in the near future, crude oil production and supply | | | | outlook on energy demand and supply of petroleum |
| will be mainly from National oil companies. The NOCs | | | | products, which is critical in determining the future |
| are powerful companies and even the smallest one is | | | | political and economic role of most National oil |
| a powerful organization within their own nations. The | | | | companies. But in many countries, crude oil and natural |
| NOCs serve public interest in many ways with the | | | | gas are key industries that impact social, economic, |
| supply of essential fuels like petrol, diesel, and natural | | | | and political issues, particularly in developing countries. |
| gas. They also provide associated services and | | | | The crude oil and natural gas sector contributes a |
| generate revenue, thus contribute to the economic | | | | major share in the domestic economy of developing |
| development of a nation. NOCs are also responsible | | | | countries. Whether it is consumption or production, |
| for managing the environment and reducing risks due | | | | there is a strong incentive in imposing comprehensive |
| to exploration, refining, and transportation of crude oil | | | | involvement by the national government to secure |
| and petroleum products. | | | | both financial and political advantage. |
| Although the National oil companies were popular and | | | | |