A big shift is happening in Big Oil: an American giant now ranks behind a Chinese upstart. Exxon Mobil is no longer the world’s biggest publicly traded producer of oil. For the first time, that distinction belongs to a 13-year-old Chinese company called PetroChina. The Beijing company was created by the Chinese government to secure more oil for that nation’s booming economy.
PetroChina announced on Thursday that it pumped 2.4 million barrels a day last year, surpassing Exxon by 100,000. The company has grown rapidly over the last decade by squeezing more from China’s ageing oil fields and outspending Western companies to acquire more petroleum reserves in places like Canada, Iraq and Qatar. It’s motivated by a need to lock up as much oil as possible. The company’s output increased 3.3% in 2011 while Exxon’s fell 5%. Exxon’s oil production also fell behind Rosneft, the Russian energy company.
PetroChina’s rise highlights a fundamental difference in how the largest oil companies plan to supply the world as new deposits become tougher to find and more expensive to produce.