'Seven Sisters Oil Companies' is explained in detail and with examples in the Investments edition of the Herold Financial Dictionary, which you can get from Amazon in Ebook or Paperback edition.
Seven Sisters Oil Companies is a phrase that was made famous by Italian state oil Company ENI Chief and Italian businessmen Enrico Mattei back in the 1950s. Mattei used this phrase disparagingly, which he coined in order to refer to the seven Anglo-American oil companies that had formed the “Consortium for Iran” cartel. They became so powerful that they soon dominated the universe of the worldwide petroleum industry in the years from the mid 1940s through the early 1970s.
The group was made up of seven American and British firms Anglo Persian Oil Company (today’s British Petroleum), Gulf Oil (most of which became part of British Petroleum and the other parts which joined Chevron), Standard Oil of California or SoCal (today’s Chevron), Texaco (later a part of Chevron in a merger), London headquartered Royal Dutch Shell, Standard Oil Company of New Jersey (Esso which became Exxon), and Standard Oil Company of New York or Socony (Mobil, which merged with Exxon to become ExxonMobil).
Before the 1973 oil crisis, the different companies from the Seven Sisters controlled approximately 85 percent of the global oil reserves. Since then, this has shifted dramatically away from the Seven Sisters Oil Companies over to a combination of the OPEC oil cartel nations as well as several state controlled gas and oil companies in the emerging world economies. These include notably Gazprom of Russia, Saudi Aramco of Saudi Arabia, China National Petroleum Corporation, PDVSA/Citgo of Venezuela, National Iranian Oil Company, Petrobras of Brazil, and Petronas of Malaysia.
The Seven Sisters Oil Companies’ common history stretches back to the Iranian 1951 nationalization of its foreign dominated oil industry. The Anglo-Iranian Oil Company, which became BP, at this time controlled the Iranian oil industry. Because Iran opted to nationalize its assets and seize the petroleum reserves, the international community placed an embargo on Iran. Once Iran agreed to return to the international oil markets, the State Department of the United States suggested that the oil majors create a major oil companies consortium. Interestingly enough, a few of them were the scions of billionaire oil man John D. Rockefeller and his original American oil monopoly the Standard Oil Company. As a result of the State Department’s appeal, the “Consortium for Iran” arose and saw seven oil majors brought on board the lucrative and influential project.
Anglo Persian Oil Company of the United Kingdom was the original player in Iran and a major player in the Seven Sisters Oil Companies consortium for Iran. The company changed names to the Anglo-Iranian Oil Company before finally becoming British Petroleum. After the company took over the Standard Oil Company of Indiana, which was better known as Amoco, and Gulf branded gas stations, British Petroleum shortened their name to BP back in 2000.
American Gulf Oil was the second company. SoCal acquired much of Gulf in 1984, and this larger firm changed its name to Chevron. Though some of its Gulf service stations in the Northeastern part of the U.S. still bear the Gulf name, the majority of these were bought out in the East coast by either BP or Cumberland Farms.
Royal Dutch Shell of Great Britain and the Netherlands was the third company. American Texaco was the fourth company. They were absorbed by Chevron in 2001. Chevron itself arose from the fifth company in the consortium Standard Oil of California, or the SoCal company of the United States. It changed its name to Chevron in 1984 after acquiring much of Gulf Oil.
The sixth company was American Standard Oil of New Jersey, or Esso. It later changed its name to Exxon before renaming itself Exxon Mobil in 1999 after it acquired the seventh consortium member Mobil. The American company Mobil itself was earlier known as Standard Oil Co. of New York, or Socony.
Interestingly enough, all of these oil companies were either American or British headquartered. ENI, the state oil company of Italy, wished to be a member of the Consortium for Iran, but was turned away by the other members of the Anglo-Saxon controlled Seven Sisters Oil Companies. These seven companies went on to dominate the oil production of the Middle East following the Second World War.
The phrase Seven Sisters Oil Companies became more popular still when British author Anthony Sampson assumed the mantle of the term in his 1975 published book The Seven Sisters. In this work, he unveiled the shadowy world oil cartel that had attempted to crush its competition and to dominate control of the global oil and gas resources.
Because they were well-funded and -organized and operated effectively as an economic cartel, these Seven Sisters managed to exercise great power over the resources, markets, and politics of the Third World oil producers. Yet the power of these seven original oil behemoths became challenged by the rise of OPEC, which was established in 1960. The rise of the all-powerful state owned and run oil companies in many emerging national economies also dealt the Seven Sisters a body blow. Finally, there was a deteriorating global share of both gas and oil reserves held by their home countries of the United States and Great Britain over the years that weakened their home markets in the world oil production arena.
Today only four of the original seven sisters remain, thanks to merger and acquisition activities over the intervening decades. This became necessary for the oil majors to compete against OPEC and the state owned oil companies. The remaining entities are now BP, ExxonMobil, Chevron (Texaco), and Royal Dutch Shell. They are collectively a part of the seven or eight super-major oil companies of the globe also called Big Oil.