Wave of oil-gobbling mergers still leaves many competitive fish

''It's really big fish devouring smaller fish out there.'' So says an oil industry specialist (requesting anonymity) who has been tracking the wave of takeovers and mergers in the oil industry.

Yet even with consolidation in the ranks of big oil companies, there are many more fish left in the oil industry than in other mature sectors of the American economy - sectors such as auto or steel, for example.

Standard Oil of California's (Socal) announced acquisition of Gulf Oil this week would be the largest takeover in history. Gulf, the nation's sixth-largest oil company, and fifth-ranked Socal would create the nation's third-largest oil company, behind Exxon and Mobil.

That may not be the end of such deals. Specialists say the incentive to buy oil companies remains strong: It is easier to buy oil by buying oil companies than it is to prospect for crude in costly areas of the globe like the Beaufort Sea.

But is merger mania in the oil industry productive for the economy?

Economists, politicians, and consumer advocates are arguing over this point. The conclusion seems to be: Mergers in the oil industry are doing little harm.

* The mergers and takeovers do not add to the country's reserves of oil. But, at least for now, oil is plentiful in the world. New reserves are becoming rarer and much more costly to locate.

* Mergers make little difference at the gas pump. The Gulf logo may be submerged in a sea of Chevron signs (Chevron is the brand name of Socal's gasoline), but gasoline prices should remain at their current levels. In fact, the consolidation of refining, exploration, and marketing operations could make for more efficiency at Socal/Gulf and therefore could hold down costs for consumers.

* Although huge loans are financing both the $13.4 billion Socal/Gulf deal and the earlier $10.1 billion Texaco/Getty deal, economists say they do not expect this to have a noticeable effect on interest rates. For a short time, credit markets may be drier and banks reluctant to make big energy-exploration loans. But once the deal is consummated, the money will find its way to stockholders, who in turn invest it in the economy in other ways.

Not everyone is sure the effect of the merger will be so slight, however.

Edwin Rothschild, assistant director of the Citizens Energy Labor Coalition, Tuesday criticized the merger as ''not in the public interest, not good for the economy.'' He and critics such as Ohio Sen. Howard M. Metzenbaum (D) and Federal Trade Commissioner (FTC) Michael Pertschuk see the mergers as decreasing competition in the marketplace.

Though Mr. Pertschuk is likely to object, the deal will probably be approved after Socal divests itself of some of its gasoline stations that operate in the same markets as Gulf.

Financial analysts note that even after the mergers, the oil industry would be much more competitive and diverse than, say, the automobile or steel industries. Small operators can capitalize companies, search for, tap, and pump crude without the massive commitment of money and personnel needed in other sectors.

''The top five oil companies would end up with 38 percent of the market,'' notes Lawrence Garschofsky, arbitrage specialist with Argus Research, ''and that will probably drop, since Socal/Gulf will have to divest itself of some of its gas stations. That still leaves a good percentage of the market for the other companies. You don't have that kind of competition in the auto industry.''

The wave of mergers and takeovers stems from a calculation on the part of oil companies that it is easier to buy oil reserves that already exist than to explore for new ones.

''There's a clear preference today for buying reserves in the ground as opposed to exploration,'' says Morris Greenberg, an energy expert with the Chase Econometrics consulting firm. ''Most large oil companies have good debt-to-asset ratios and can afford to take on more debt. It's much more risky to be involved in upstream operations where you can sink millions of dollars into a hole and come up dry.''

In the Socal/Gulf deal, for instance, Socal will be paying $4 to $5 a barrel for Gulf's reserves. ''The going rate for finding oil in the ground is twice that,'' says Stephen A. Smith, senior vice-president at the Data Resources Inc. consulting firm.

That calculation motivated Texas oilman and financier T. Boone Pickens Jr. of Mesa Petroleum to buy large blocks of Gulf last summer. Mr. Pickens said his intent was to radically restructure the Pittsburgh-based corporation. Last fall Gulf fought and won one of the biggest proxy battles in history over a corporate reorganization aimed at keeping Pickens off the board of directors.

But then Pickens and allied investors, already controlling 13.2 percent of Gulf stock, made a $65-a-share tender offer for 8.2 percent more of Gulf. Gulf had to act fast, for shareholders who have tendered their stock to the Pickens group have only until March 14 to withdraw those shares in order to sell them to another bidder.

To fend off the takeover attempt, Gulf sought other buyers, opening its account books to as many as half a dozen suitors. Socal apparently submitted the highest bid, offering to pay $80 a share for Gulf's outstanding stock. By comparison, last Nov. 30, Gulf was trading for $44 a share.

But in the case of Socal/Gulf, as in the case of Texaco/Getty, that may not be the end of the story, since the oil reserves of these corporations are still much cheaper than the cost of new oil from the ground. The ink was barely dry on the FTC's approval of Texaco's plan to buy Getty when the Bass brothers of Fort Worth, Texas, began maneuvering to buy Texaco. In a single day of trading, Texaco's stock rose $2 a share.

Mr. Smith of Data Resources sees two important developments as stimulating this merger and takeover activity. A poor showing in the Mukluk field in the Beaufort Sea off of Canada underscored the financial risks of exploration. Meanwhile, world oil demand appears to have bottomed out, stabilizing the price of crude.

As a result, Smith says, ''we probably have not seen the last of the mergers. I don't think we see that advantage (of buying existing oil reserves, as opposed to searching for new oil) going away.''