Oil companies

Oil companies engage in exploration and production of oil ("upstream" activities), oil transportation and refining ("midstream"), and petroleum product wholesale and retail distribution ("downstream"). The largest companies, known as the "majors," are vertically integrated, with business operations along the entire spectrum from exploration to gas stations. Smaller oil companies, known as "independents," are often exclusively involved in exploration and production. Upstream is considered the glamorous place to be, where all the big decisions are made. Upstream jobs also involve heavy international work, with many employees sent off to new postings around the world every 3 years or so. We should also note that E&P businesses are fairly similar in nature among oil companies and companies mining other natural resources like uranium or coal--moving among these types of firms during a career can be a logical path.

The majors are known for excellent rotational training programs, and a fair number of people take advantage of those programs and then jump over to independents for good salaries. Oil companies pay well in general, but jobs are not necessarily as stable as one might think. When oil prices drop, company operating profits are dramatically impacted, and layoffs are fairly common. American oil jobs are overwhelmingly concentrated in Houston. International hot spots include London, Calgary, and the Middle East.

Some oil companies focus exclusively on midstream and downstream activities. They operate refineries to distill crude oil into its many commercially useful petroleum derivatives, like gasoline, jet fuel, solvents, and asphalt. Refineries are, in theory, built to last 40 years, but some have been around for as long as 80 years. That means that new refineries are rarely built, and the refinery business is mostly about managing the razor-thin margins between purchased crude oil inputs and revenues from refined product outputs.

Oil services companies

Oil services companies provide a very wide range of outsourced operational support to oil companies, such as owning and renting out oil rigs, conducting seismic testing, and transporting equipment. The fortunes of these companies follow the price of oil: when oil is expensive, oil companies drill a lot and make a lot of money, so business volume and revenue increase for their oil services contractors. Working for an oil services company probably means working in Texas or internationally, and can feel very much like working for an oil company, given the similarity in issues and activities.

Pipeline operators

Pipeline operators own and manage tens of thousands of miles of petroleum products and natural gas pipelines. Many of them also operate oil intake terminals, engage in commodities trading and energy marketing, and own natural gas storage facilities or petroleum refineries as well. Unlike the major oil companies, pipeline operation companies are not household names--nonetheless, the largest ones take in several billion in annual revenue, comparable to the scale of a medium-sized oil company.