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While many in the U.S. Congress spend their days vilifying American energy companies, our foreign competition continues to expand. The latest: the hugely popular IPO of PetroChina, a massive state-owned firm that is now selling shares on several world stock exchanges. The result is, according to media reports, a company with a market cap of over $1 trillion, more than twice the size of ExxonMobil.Ã‚Â While the trillion dollar figure is probably overstated, it does seem that this operational scale and scope is necessary to compete in the global energy sector, which is hugely capital-intensive and dominated by enormous companies (that are also often government-owned).
So, next time you hear a Congressman rant about "gas price-gouging" and "windfall profits" as he recommends new energy taxes and regulations, understand that those self-defeating ideas will handicap private American firms trying to match some very big competition.