The term, analogous to others, such as Big Steel, that describe industries dominated by a few giant corporations, was popularized in print from the late 1960s. Today it is often used to refer specifically to the six supermajors. The use of the term in the popular media often excludes the national producers and OPEC oil companies who have a much greater role in setting prices than the supermajors. Two state-owned Chinese oil companies, CNPC and Sinopec, had greater revenues in 2013 than any of the supermajors except Royal Dutch Shell.
The supermajors began to emerge in the late-1990s, in response to a severe fall in oil prices. Large petroleum companies began to merge, often in an effort to improve economies of scale, hedge against oil price volatility, and reduce large cash reserves through reinvestment.
The following major mergers and acquisitions of oil and gas companies took place between 1998 and 2002:
BP's acquisitions of Amoco in 1998 and of ARCO in 2000;
Exxon's merger with Mobil in 1999, forming ExxonMobil;
Total's merger with Petrofina in 1999 and with Elf Aquitaine in 2000, with the resulting company subsequently renamed Total S.A.;
This process of consolidation created some of the largest global corporations as defined by the Forbes Global 2000 ranking, and as of 2007 all were within the top 25. Between 2004 and 2007 the profits of the six supermajors totaled US$494.8 billion.
Composition and present status
Trading under various names around the world, the supermajors are considered to be:
ConocoPhillips Company (United States) is also sometimes described as forming part of the group. As of 2011 ExxonMobil ranked first among the supermajors measured by market capitalization, cash flow and profits.
Petroleum and gas supermajors are sometimes collectively referred to as "Big oil", a term that emphasizes their economic power and perceived influence on politics, particularly in the United States. Big oil is often associated with the fossil fuels lobby.
Usually used to refer to the industry as a whole in a pejorative or derogatory manner, "Big oil" has come to encompass the enormous impact crude oil exerts over first-world industrial society.
^Nafta - Volume 56 - Page 447 2005 "Tom Nicholls, editor, Petroleum Economist, writes WHOEVER coined the term supermajor should have kept some superlatives in reserve. Oil companies may rank as some of the biggest private-sector corporations, but when it comes to oil ..."
^Corporate Packaging Management C. Wayne Barlow - 1969 "Even with the price ceilings, gas cost more than it had, prompting consumers to charge that “Big Oil,” and not the Arabs, had used the crisis to squeeze profits from oppressed consumers. Some thought that the oil companies got rich from the ..."
^Defending the National Interest: Raw Materials Investments and ... - Page 330 Stephen D. Krasner - 1978 "Kennedy's Treasury Secretary, Douglas Dillon, was a director of Chase Manhattan Bank and thus tied to the Rockefellers and big oil. Nixon's campaigns were partly financed by oil money, and his Secretary of the Interior, Walter Hickel, was an ...
^Encyclopedia of Business in Today's World: A - C - Volume 1 - Page 174 Charles Wankel - 2009 The older term Big Oil, used in reference to the cooperative behavior and lobbying of oil companies, is often used now to refer specifically to the supermajors. Each supermajor has revenues in the hundreds of billions of dollars, benefiting from ...
^Green Energy: An A-to-Z Guide - Page 331 Dustin Mulvaney - 2011 "the oil majors have the power to manipulate oil prices, profiteering at the expense of consumers in North America and Europe. Although the term Big Oil is used in the media, it is not used to describe the Oil Producing and Exporting Countries'
^Crude Reality: Petroleum in World History Brian C. Black - 2012 "Therefore, Big Oil included large-scale corporate infrastructure that spanned the globe without ever releasing the basic elements that titillated the public: fortune, danger, and bust. Today, the term Big Oil most likely evokes a negative visceral ..."
^Role of National Oil Companies in the International Oil Market Robert Pirog - 2011 "In the United States, the term “big oil companies” is likely to be taken to mean the major private international oil companies, largely based in Europe or America. However, while some of those companies are indeed among the largest in the ..."