PetroChina loses world's No.1 ranking to Exxon

PetroChina<601857><857>, the country's top oil producer, lost its world's No.1 ranking to Exxon Mobil Corp, as the company failed to keep up with the surging global oil prices, market sources reported.

PetroChina shares dropped for the fifth straight day, with its A-shares dipped 2.52% to RMB 18.53 and H-shares fell 1.3% to HK$9.69 yesterday. Thus, its market value fell to US$453.1 billion, and lost crown to Exxon Mobil, which had a market value of US$455.8 billion as of yesterday's close in New York.

On Nov. 5, 2007, PetroChina's stock price more than doubled in the first day of its Shanghai trading after offering four billion shares, which helped it surpass Exxon Mobil as the world's largest company by market value.

Analysts noted that PetroChina lost the reign of almost five months as the world's most valuable corporation was partly due to the price controls on oil and gas imposed by the Chinese government, which prevented the oil giant from passing higher oil costs on to fuel users and transport companies.

In contrast, Exxon Mobil's refining business booked profit of US$184 million a week last year, by selling 80% of the fuel it produces in the Americas, Europe and other markets where price controls are less restrictive.

Furthermore, PetroChina's costs for drilling wells and building pipelines increased by 30% in 2007 to approximately US$36 billion, compared with a 3.1% drop in such expenses at Exxon Mobil, according to sources.