General market overview
Oil remains the world’s dominant fuel, though it has steadily lost market share to coal and natural gas in recent years. Oil’s share of the world total consumption of primary energy sources has fallen from 38.7% to 34.8% over the past decade. Both oil consumption and nuclear power generation declined last year, while natural gas and coal consumption, as well as hydroelectric generation, increased.
Source: BP Statistical Review June 2009
The oil industry is divided into two main segments, upstream and downstream. Upstream includes operations such as exploration and production of crude oil and natural gas, while downstream includes operations such as refining and distribution of petroleum products in the form of fuel, heating oil or as raw material for the petrochemical industry. Oil companies of the latter kind are known as integrated companies, and examples of these are Royal Dutch/Shell, Exxon Mobil and BP. Kulczyk Oil Ventures is a pure upstream company focused on exploration and production.
