The major segments

The value chain constitutes a long vertical process from exploration to distribution and involves numerous intermediaries, either several specialized companies or divisions of the same integrated company.
 

Source: www.eia.doe.gov
 

• The production process

 The process of exploring for, developing, and producing oil involves several steps and generally lasts several years from beginning to end. 

Exploration
 The first step in the production process involves searching for oil. Geologists and geophysicists try to identify areas likely to contain reservoir rocks. Subsurface conditions are then investigated using seismology or other techniques.
Drilling
 If an area appears to have oil, the company formulates a drilling plan and begins to drill exploration wells. If the amounts of oil found are considered sufficient to produce economically from the well, the process moves to the completion stage.
Completion
 If a well contains commercial quantities of oil, it must be completed before production can begin. Completion involves building production casing to the bottom of the hole. A steel pipe is then used to seal off fluids and prevent the hole’s wall from falling.
Lifting
 This step consists in bringing oil to the surface. Several methods are used: oil can be either pushed to the surface through the use of pumps, or through the injection of water or natural gas.
 

• Refining crude oil

 The refinement of crude oil creates a wide range of final products. The process begins with distillation, in which the oil is brought to a boil and mostly vaporized. The components of the crude condense at different temperatures, with the lighter, high-valued products condensing at the lower temperatures found at the top of the condensing tower. More complicated processes break apart some of the heavier compounds or mix lighter compounds together.
 

Sources: American Petroleum Institute

Refining processes include the following steps: cocking, catalytic, cracking, hydrocracking, hydrofining and reforming.
 

• Marketing

 Oil industry marketing involves selling refined products to customers and businesses. Different marketing methods exist for each of the many products that come out of the refinery.
 

The different actors and intermediaries
 

• International integrated oil companies

 They are involved in almost every aspect of the oil business: the upstream, the midstream and the downstream. Most integrated oil companies are also engaged in the manufacture and sale of petrochemicals. 
 International integrated oil companies conduct their operations worldwide, and they are among the largest and most recognized firms in the world. The largest such firms are Exxon Mobil, Royal Dutch/Shell Group and BP Amaco. Each of them sees more than $100 billion in annual revenue. 
 International integrated oil companies based outside the United States include both publicly owned and state-owned firms. Major publicly companies based outside the US include Total Fina of France (which acquired Elf Aquitaine in March 2000), Repsol-YPF of Spain, and Norsk Hydro of Norway.
 

• Domestic integrated oil companies

 These US companies explore for and develop oil worldwide, but their refining and marketing operations are generally limited to the United States. They include Amerada Hess Corp., Atlantic Richfield Co., Conoco Inc., Occidental Petroleum Corp., Phillips Petroleum Co., and USX-Marathon Oil Co.. The largest companies in this group have annual revenues in excess of $13 billion.
 

• Exploration and production companies

 They are often referred to as independents because they are not associated with any of the major oil companies. These firms find and develop oil properties in the United States and, to a lesser extend, overseas. They are involved only in the upstream, and thus are more vulnerable to the changes in oil prices than integrated oil companies are. 
 Although this category includes companies that range from the very large to the extremely small, the largest independent oil companies are multibillion-dollar entities. The largest independent exploration and production companies include Anadarko Petroleum Corp., Apache Corp., Burlington Resources Inc., EOG Resources Inc., Noble Affiliates Inc., Pioneer Natural Resources Co., Union Pacific Resources Group Inc., and Unocal Corp.
 

• Refining and marketing companies

 These companies refine and/or sell crude oil products such as gasoline, jet fuel, heating oil, motor oil, and various lubricants. Leading refining and marketing companies include Ashland Inc., Pennzoil-Quaker State, Sunoco Inc., Tosco Corp., Ultramar Diamond Shamrock, and Valero Energy.