The changing relationship between international oil companies and national oil companies is a fascinating topic that constantly shifts with global economic trends, supply/demand fundamentals, geopolitical balance of power and much more. The global oil market pivot eastward toward rapidly expanding Asian economies is nothing new, but the prospect of a powerful new Asian-based international oil company that could rub shoulders with the 7 Sisters is.

An editorial in the Financial Times by Nick Butler argues the existing western-based oil majors are in decline, hamstrung by investors’ need for quarterly returns, overly focused on corporate social responsibility, and perhaps worst of all, lack a “sense of adventure and expansion.”

Whether you agree or not, the piece is worth reading [subscription may be required].

“For some time, the idea has been around that the Chinese or others are about to buy a big European or American energy company. A Chinese bid for the troubled BG is the latest rumour. I don’t believe it. As the Chinese company Cnooc found when it tried to invest in Unocal in 2005, the west is still sensitive to issues of nationality and ownership. In any case, why should the Chinese or anyone else buy companies which have lost their way and which require a big change in strategy and management? It would be much easier for them to build their own enterprises. Think of it as “Pacific Energy”.” Nick Butler, Financial Times