Jin Zhang's study of the oil industry examines the challenges China faces in its efforts to create indigenous firms capable of competing with the world's leading companies. The task of catching up with the international oil giants is daunting for China's oil firms not only because the global oil business is one with a high cost of entry in terms of experience (the top companies have been around the longest), but also because, as Zhang observes, they are chasing a moving target. The international oil industry of today is fundamentally different from that of the 1980s and early 1990s when the Chinese government embarked on its tortuous path to reform China's oil sector. The mergers that occurred between the world's major oil companies in the late 1990s created a smaller group of much larger companies at the apex of the international oil industry, greatly expanding the gap between these companies and China's aspiring giants. Furthermore, many state-owned firms have disappeared from the ranks of the world's leading oil companies, a development that runs counter to China's strategy of catapulting its “national champions” into this peer group.

Zhang illustrates the magnitude of these challenges facing China's aspiring oil giants through her systematic comparison of BP and Shell with PetroChina and Sinopec, the partially-privatized subsidiaries of the state-owned China National Petroleum and Natural Gas Group Company (CNPC) and Sinopec Group respectively, on a number of key business and organizational criteria. At first glance, the lead these “super majors” have over the Chinese companies in terms of business capabilities such as financial performance, technological prowess and the quality of their reserve portfolios, is more striking than the advantage the super majors have in organizational capabilities such as structure and leadership. Indeed, the organizational structures of PetroChina and Sinopec resemble those of BP and Shell. Zhang notes, however, that beneath these superficial similarities lie two critical differences between the Chinese companies and the super majors, differences that arguably constitute the greatest obstacle to the Chinese oil companies “catching up” with the super majors.