World Market Players
The world is not only divided between rich and poor nations or between the haves and the have-nots. It is also divided along oil-exporting and oil-importing countries. For oil exporters, it is the OPEC that carries their voice in the world oil stage. For oil importers, it is the OECD. OPEC has been losing market share in world energy markets, accounting for only 40% of total oil production. Non-OPEC countries produced the balance of 60% and at one time, it even went to as high as 71% of total world production. The 5 major non-OPEC countries with sizable oil productions are Canada, Norway, United Kingdom, Russia and Mexico. The first 3 nations have oil sectors that are operated privately while that of Mexico’s and Russia’s are mostly government owned. All the five nations have very little spare production capacity. In case of supply shortages, extra oil can be obtained only from OPEC members with their reserve pumping capacities. The U.S. and the U.K. are big oil producers but they are also big consumers. Most of their production is not exported but rather used domestically. Seven nations in the top 14 oil producers are OPEC members while the remaining seven are non-members. However, of the 14 top oil exporters, ten are OPEC members. The other 4 big net oil exporters are Russia, Norway, Mexico and Kazakhstan. Norway and U.K. are minor exporters.
The United States is the world’s biggest net oil importer followed by China. Of the 85 million bbl/day of global oil consumption, approximately 8.5% is consumed by OPEC countries. Most of the world’s largest oil consumers are therefore also its largest oil importers with notable exceptions of Russia and Canada. Both countries are big consumers but they have bigger oil production so the excess is exported. One interesting fact is 90% of the world’s oil refining capacity is located in non-OPEC countries. This is just a question of economics rather than of anything else. Refining and distribution have been spun off by most major oil firms because they want to concentrate on their core competencies – oil exploration and drilling. The U.S. has the largest oil refining capacity with 149 refineries out of the 691 world total. Other nations with significant refining capacities are Russia, Japan and China. Others such as Singapore, South Korea and the Netherlands are important sources of refined petroleum products but with little crude oil production. In these countries, oil refining is a significant sector of their economy.