...Effects of Petroleum Prices on the Economy Crude oil prices have taken a dive in the last month, causing the gasoline prices to plummet. Consumers are more than ecstatic to see the prices fall, but this current trend in prices will undeniably be short term. For most of us the prices of petroleum is only apparent at the gasoline pump, but there are multiple products affected such as diesel and heating oil. The intent of this paper is to focus more on gasoline prices, supply and demand of gasoline, and elasticity demand of gasoline, externalities, regulations, and taxes that have put into place regarding gasoline. Also, explaining the underlying origin of such a histrionic change will give a better perspective to all consumers. Let’s start by explaining what OPEC is and their involvement in the petroleum market. Organization of Petroleum Exporting Countries (OPEC), is an intergovernmental organization consisting of Iran, Iraq, Kuwait, Saudi Arabia, Venezuela, Qatar, Libya, United Arab Emirates, Algeria, Nigeria, and Angola ( Brief History, 2015). OPEC was established in 1960 with five original countries and has since added numerous more. The initial and current objective of the OPEC is to maintain prices that are both consistent and protected for the producers of petroleum. OPEC intends to supply the consuming nations with petroleum while gaining a just return on capital to those investing in the industry ( Brief History, 2015). How have changes in supply...
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...within an industry. These five forces are: the risk of entry by potential competitors, the intensity of rivalry among established companies within an industry, the bargaining power of buyers, the bargaining power of suppliers, and the closeness of substitutes to an industry’s products. The threat of new entrants in the airline industry is low. In this time of economic distress it is tough to find an institution willing to loan the necessary capital it would take to start an airline. Without a loan it is nearly impossible to start up an airline company and therefore there are not many new companies entering the market. Even if a company could surpass these economic barriers it would find it hard to compete with airlines that have established brand recognition. These solid brands in the airline industry are able to offer lower prices and better incentives than an incoming airline and these economies of scale increase entrant barriers. Also, the respectable number of established airlines that have made up the industry have a strong hold on airports hubs. These hubs are crucial to bringing and taking customers to and from airports. An entrant into the airline industry may not have these privileges which would stall their business. A greater threat to the airline industry would be substitutes. Substitutes are a medium threat to the airline industry. Recently oil prices have fallen below $30 a barrel and it is becoming increasingly cheaper to drive. The distance that one is traveling...
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...Analysis of Edible Oil Industry ANALYSIS OF PAKISTAN INDUSTRY PRESENTED BY: HUSNA BADAR(7164) KOMAL SHAHDEV(756) MISBAH SALEEM(4258) SUBMITTED TO: SIR AFTAB ABRO Institute of Business Management, Karachi Table of Contents Brief history about the edible oil industry 8 Present Situation of edible oil industry in Pakistan 8 Consumption 8 Edible oil industry (3 segements) 8 Group 1(Premium Segment) 9 Group 2(Popular Segment) 9 Group 3 (Lower Segment) 9 Market share analysis of the overall industry 10 Branded versus unbranded 11 Analysis of the total market reveals that about 43% of the market is unbranded and the remaining 57% market is branded oil. 11 Market share information of tier 1 segment 11 Manufacturing process 12 The procedure that is adopted by all manufacturers of edible oil is given as follows. However organizations modify the processes to suit their requirements. 12 Step # 1: Blending of different oils in different quantities. 12 Step # 2: Refining the blended oil. 12 Step # 3: Packaging. 12 Step # 4: Marketing and Sales 12 Source of edible oil 13 Important facts regarding oil seeds 16 Categories of oil 17 Product 22 Pricing 23 Placement – distribution network 23 Promotion 23 Positioning – critical success factor 23 Competitive prices 24 Dalda FOODS PVT LTD 25 product: 26 Pricing 26 The price of Dalda is slower than Habib in spite of the fact...
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...CSR Grasp * CSR Embedment (integrate social objectives w/ bus goals; balance social & eco profits) * Definition of CSR * Notion that corporations have a obligation to society to take into account not just their economic impact, but also their social and environmental impact * Five dimensions of CSR * Environmental, Social, Economic, Stakeholders, Voluntariness (ESESV) * Align with triple bottom line of economic, environmental and social goals. * The Challenge * Energy industry has allowed economic progress, provides power, heat, light and is the oxygen of the economy. * However people also see energy industry as exploiting natural resources/harmful to environment * Global oil demand for OECD countries currently above 40million barrels per day, whilst non-OECD countries under 40 million. However 2015 non-OECD countries will take over OECD countries, and by 2035 OECD will remain at 40, whilst non-OECD is 60....
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...available on the market and demand is how of the product is demanded by the consumers. In this respect, when demand increases so do the prices and supply decreases and when demand decreases, prices go down and supply will then increase. Through observing and researching, it shows that they are just as important in maintaining market equilibrium. Therefore retailers of wholesale products impact the economy when they increase prices such as what is being done with the gasoline at this time. Gas prices have seen some fluctuations over the past twelve months with a steady increase happening over the past six months in the state of Virginia and I’m sure the entire nation has seen the same. These fluctuations have been due to the economical crisis throughout the world. Some attribute the conflict in Iraq as the main problem. Other causes can stem from natural disasters, or political ties among leaders. In researching the price history of crude oil, it has fluctuated between $72 to $113 between January of 2011 and January 2012. However within that same time period Virginia’s prices fluctuated from $2.99 to $3.93 with the highest price being May of 2011. Seeing the prices on a continuous roller coaster can prompt consumers to be more mindful of their travel intentions. As consumers however, it is difficult for us to understand when someone in government will step up to the plate and figure out a way to make things better for their constituents. Crude oil contributes to basically everything...
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...Energy 15 August 2015 The Prize: Epic Quest for Oil, Money, and Power The history of the petroleum industry is a long and enduring journey. It was not started by one single individual, but by the actions of a long list of entrepreneurial figures whom all play a part in this oil journey. Oil was first used as a sort of home remedy by the Indians. They called it “Seneca Oil” and it was used to cure headaches, upset stomachs, burns, to heal wounds and the list goes on. George Bissell was a very important individual in the creation of the oil industry. He spotted a bottle of this Pennsylvania rock oil in one of his professor’s classrooms. He became very curious with the rock oil and believed that it could be used as an illuminant because it was flammable. If this rock oil could become the new illuminating oil, Bissell would become an extremely wealthy man and that became his motivation. In 1854, Bissell gathered investors and hired a professor from Yale, Benjamin Silliman, to analyze all the properties of this oil to determine if it could indeed be used as an illuminant and lubricant. Sure enough, the research proved that rock oil was the next big illuminant and Pennsylvania Rock Oil Company was created in 1854. However it was not a breeze to get this oil. Edwin Drake, a retired railway conductor, was tasked to use his salt techniques to find oil. In spring of 1859, Drake’s driller who was called “Uncle Billy” spotted oil floating at the top of a pipe. This moment was the...
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...day of a particularly dirty form of oil, expected to reach refineries in Port Arthur, Texas on the Gulf of Mexico. I hear the sound of disaster headed to us faster than a locomotive. Montana is full of pristine water ways and unspoiled lands. The greekgroke web site says sending bitumen down a pipeline is especially problematic and damaging: it’s a more acidic form of petroleum that requires more heat and pressure than conventional oil, which increase pipeline stress to keep it moving. (Chameides) How can this create anything but a hazard to the communities and environments of the states the pipeline is proposed to cross? The Environmental Defense website says Canada’s own environment commissioner says there is a lot the federal government doesn't know about the environmental effects of the oil sands, despite having spent close to $10 billion over the last three decades on climate-change programs. (Staff) Canada’s environmental record has been given a double blow, from a scathing federal audit and a European Commissions assertion to blacklist oil sands products. (Staff) Why would our government even consider putting toxic oil sands across the United States? Canada should use its own refineries and ports that are already established, especially in view of Canada not knowing the full impact the oil sands have on its ecosystems. Pipeline and refinery expansions are taking place with inadequate oversight and information. How much additional pollution will the tar...
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...Strategic Management on Sapura Kencana Petroleum Berhad 1.0 INTRODUCTION A core competency by definition is a unique ability that a company acquires from its founders or develops that can make a significant contribution to perceived customer benefits of a product or services and it is difficult for a competitor to imitated. Core competencies are what give a company one or more competitive advantages, in creating and delivering value to its customers in its chosen field (Anonymous). According to Fred (2013), core competencies define as a value chain activity that firm performs especially well. When a core competence evolves into a major competitive advantage, it will turn into distinctive competence. Core competencies may include any combination of skills, technologies, processes, knowledge or expertise and are often achieved as a result of long-term development processes and/or experiences (Mayhew, 2010). Competitive advantage on the other hand is defined as a measure relative to rivals in a given industry. Competitive advantage happen when a firm can do something that rival firm cannot do, or owns something that rival firm desire (Fred, 2013). For example, Nestlé core competency is food and beverages that is full with nutrition, health and wellness. By defining own core competencies and SWOT (strength, weaknesses, opportunity and treats) the company will be able to focus on its organisation uniqueness. In this study, I will focus on the core competency for Company...
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...1. Everyone’s Gasoline Problem. We are all familiar with fluctuating prices of gasoline at the pump. Why does this happen? Research the recent history of gasoline pricing in your area, and attempt to relate any fluctuations you observe to documented supply and demand factors outlined in our book. Be sure to cite any references used. * Gasoline prices rise and fall depending on supply and Demand. Gas prices are impacted by a number of factors, each individually placing its own pressure on our overall energy system. Some affect the price of crude oil and others affect the cost of producing and marketing gasoline, but combined, these factors greatly impact the fluctuation of gas prices that we experience on a daily basis. Changes in crude oil prices - Crude oil prices are determined by worldwide supply and demand, with significant influence by the Oil Producing and Exporting Countries (OPEC) as they determine how much oil to produce and sell to other countries. The more crude oil OPEC chooses to produce and release, the lower the price. Additionally, because oil is traded in a world market, events in remote areas affect the price of crude oil for almost everyone. In recent years, worldwide events that have impacted gas prices include: Decisions by the OPEC cartel to raise production quotas slowly and reluctantly after having reduced them in 2002. * An increase in worldwide demand for oil, including unexpected demand growth in China, India, and other quickly developing nations...
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... ExxonMobil is an American established gas and oil firm that has a head office in the metropolis of Irving, Texas. Even though it is American established and holds its head office in Texas, it is additionally a multinational firm that is recognized and utilized worldwide. The Exxon Firm was instituted in the year of 1934 across the mergence of the Average Oil Firm of New Jersey and the Anglo-American Oil Company. Even though these two firms joined in 1934, the name and company of Exxon did not come about until 1972. Exxon Mobil was instituted afterward, in 1999, alongside the mergence of Exxon and Mobil. ExxonMobil is an extremely prosperous firm, generally because “it is the third biggest firm by revenue and the subsequent biggest openly traded firm by marketplace backing in the world.” (Nagurney, 2010) An example of how big and successful ExxonMobil is, is lead by its largest shareholder, which happens to be the Bill and Melinda Gates Foundation. “The company is ranked No. 5 globally in 2013. ExxonMobil’s reserves were 72 billion BOE (barrels of oil equivalent) at the end of 2007 and, at then rates of production, were expected to last over 14 years. With 37 oil refineries in 21 countries constituting a combined daily refining capacity of 6.3 million barrels, ExxonMobil is the largest refiner in the world, a title that was also associated with Standard Oil since its incorporation in 1870.” (Nagurney, 2010) All of the products that...
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...Assignment #3 Production and Operations Management Explain one possible option that Marathon could take to reduce the time involved in the production process. Marathon Oil is the leading integrated energy company, known for many things such as the exploration of gas and oil, oil production and refining, marketing and distribution and transportation of the finished product. Strategically located thought the world, in places such as the U.S., Angola, Canada, Equatorial Guinea, Gabon, Indonesia, Ireland, Libya, Norway, and the UK makes Marathon a large international conglomerate that is easily accessible in many markets. With pipelines running throughout the United States, Marathon is able to supply large quantities of oil to various suppliers within hours. With a large number of the U.S. oil refineries located in hurricane regions, (Such as Louisiana) can cause significant price changes at the pump, when natural disasters such as hurricane Katrina and Rita occur. By expanding and/or creating new refineries in other regions, Marathon will allow production and operation responsibilities to shift to other workers and bring more supply into the marketplace. This would take pressure off refineries when they are not able to operate under normal circumstances. Creating new refiners would not only create new jobs, but also bring in needed revenue to the economy. Another option that Marathon could take to reduce the time involved in the production process is to upgrade existing...
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...Being that the 1973 Oil Embargo was a major crisis that changed the way we consume energy today, it was surprisingly difficult to find a “lessons learned” report on the incident. I Google searched terms such as “1973 Oil Embargo lessons learned report”, “1973 Oil Crisis policy outcomes”, “1973 Oil Embargo aftermath”, and “1973 Oil Crisis synopsis”. I also searched the Department of Energy’s website for reports on the embargo and found relatively little information. It was not until I emailed you for help that I found documentation on the policy outcomes and reports on the 1973 Oil Embargo event (also known as the Arab Oil Embargo). The report I am using to analyze the crisis is from the Federal Energy Administration written in 1980 by Roger Anders. The report summarizes the outcomes resulting from the 1973 Oil Embargo—specifically, the establishment of the Federal Energy Administration, The Energy Policy and Conservation Act, The Energy Conservation and Production Act, and...
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...past few years it has run into some threats that could greatly affect the financial future of the company. SWOT Analysis: Strengths ● ● ● ● ● ● ● ● ● ● ● Best low cost carrier Reliable Standardized fleet Fleet is owned High number of flights Direct flights Utilizes less popular/expensive airports Focused on customer service No frills Open seating philosophy Great relationship between management and staff ● Established and reputable brand name ● Conservative growth philosophy Opportunities ● ● ● ● ● ● ● Expansion into international markets Expansion of domestic destinations Acquisitions of competitor airlines Improve turnaround efficiency Upgrade fleet Offer customers perks for a price Improve customer satisfaction ● ● ● ● ● Weaknesses ● Confusion caused by open seating philosophy with new customers ● Fleet is aging ● Focused on business travelers ● Growing operating expenses ● Conservative growth philosophy ● Being imitated by other airlines ● Limited destinations Threats Being copied by airlines Economic recession Volatile cost of fuel and oil Terrorist attacks FAA mandated safety, operational, and maintenance standards ● Weather uncertainty ● Substitute transportation Key Problem: For 36 consecutive years Southwest has managed to increase its profitability. Continuing this trend is the challenge faced by the airline due to higher operational...
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...Features of a publicly traded company A publicly traded company, in essence, is a company that that trades its stocks in the public market. Examples of the public market are the stock exchange and over the counter market. A publicly traded company is also known as a public company. In a public company, the shares and stocks are not limited to a particular group of people; the stocks can be bought by anyone from the public. A public company is however required to have a minimum of two directors and an unlimited number of shareholders; in addition, this company should have a minimum share capital. Such companies can easily raise more capital when compared to private companies since they can legally offer liquidity to the shareholders. These companies, nevertheless, have to abide to strict Securities Exchange Commission regulations and have to give clear and accurate data to the investors. Publicly traded companies also have to provide all information to the public without bias be issuing their prospectus the number of times the law requires them to. A public company is also its own legal entity meaning that the company and the owners are legally two separate things. Therefore, the company’s existence does not depend on the owners or directors. In these types of companies, the people with the highest number of shares and stocks are the ones who have the most say in deciding the company’s policies. These policies are generated at least once a year in their annual general meeting...
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...Oil price: traders and CEO’s clash over recovery prospects OBJECTİVES *What is the OPEC and it’s main goals? *Why are oil prices falling? *Who are the winners and who are the loosers? *Consequences of falling prices. *Important comments about oil price. What is the OPEC and it’s main goals? Organization of the Petroleum Exporting Countries (OPEC), a permanent, international organization headquartered in Vienna, Austria, was established in Baghdad, Iraq on 10–14 September 1960.Its mandate is to "coordinate and unify the petroleum policies" of its members and to "ensure the stabilization of oil markets in order to secure an efficient, economic and regular supply of petroleum to consumers, a steady income to producers, and a fair return on capital for those investing in the petroleum industry. In 2014 OPEC comprised twelve members: Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela. Why are oil prices falling? Here are four main factors driving oil’s sharp decline: 1. US oil production is booming Exploding US oil production has transformed one of the world’s leading oil consumers into one of its leading producers as well – in fact, North Dakota alone produces a million barrels of oil per day. US production now rivals oil giants Saudi Arabia and Russia, largely thanks to innovative drilling that has unlocked oil and natural gas deposits trapped in shale rock. US production has...
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