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IOCs to NOCs: the big trend of the last 75 years
1/4/2026
8 min read
Feature
Over the last 75 years since the first Statistical Review of World Energy was published, the biggest trend in the oil and gas sector has been the emergence of a profusion of nationalisation initiatives and the growth of state-owned national oil companies (NOCs), as the major independent oil companies (IOCs) – commonly known as the ‘Seven Sisters’ – lost control of much of the world’s fossil fuel resources, writes Brian Davis.
This story actually begins in the 1920s when the first NOC, Yacimientos Petroliferos Fiscales (YPF) was founded, followed by Petroleos Mexicanos (Pemex) in the 1930s. However, the boom in NOCs actually occurred in the 1970s, triggered by a tide of nationalism and enthusiasm for state intervention worldwide.
The turning point was marked by creation of the Organisation of Petroleum Exporting Countries (OPEC), led by Sheikh Ahmed Zaki Yamani, which had stunning success wresting control of international oil markets, and dramatically increasing oil prices to the chagrin of the western world.
Initially, the NOCs were expected to operate mostly upstream in exploration and production (E&P) as rentiers through OPEC – capturing a large share of the economic rents associated with oil production, with downstream operations like product import, refining, petrochemical production and marketing left to the IOCs. In reality, the oil shocks of the 1970s and concern about supply security moved oil to centre stage and led to the creation of NOCs also operating downstream.