PetroChina is now trading with big valuations after getting a 17% increase in their share price, thus becoming at par with the competition.

A 17% increase may not seem much, but the Chinese oil giant is reaping the rewards of what the Wallstreet Journal calls a quick run-up in the stock market of Shanghai. To add insult to injury, the low prices the oil company offers allows them to perform better than their global contemporaries, such as ExxonMobil Corp.

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PetroChina is a state-owned petroleum company and is China's biggest oil producer. Established in 1999, the company trades in Hong Kong, New York, as well as the Shanghai Stock Exchange, with a diverse partnership with other oil companies from neighboring countries.

The sudden rise of the state-owned petroleum company can be attributed to the local style of investing, which The Globe and Mail sees as investors chasing after copanies that are already on their way to the top. However, a lot of skeptics are also asking until when this bubble will last. In fact, a whole slew of investors are doubting the sudden rise of the company's prices.

There are talks on forced consolidation to be spearheaded by the government as precautionary measures to alleviate the assumed fall. The companies in the supposed merger? The two biggest oil companies in China: PetroChina and Sinopec.

Sinopec is the biggest competition of PetroChina and is based in Beijing. Just like their competition, Sinopec is listed in New York, Hong Kong, and Shanghai and is also state-owned, which explains the rumors of a supposed merger.

The same way that Sinopec and Petrochina both denied the alleged merger between them, reports on Reuters saying that both companies have not received any authoritative command, and executives are resisting to do the same.

TagsPetroChina, Sinopec, PetroChina Sinopec merger, Shanghai Stock Exchange