• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

The world oil market is a Homogenous Co-operative Oligopoly. A broad definition of an oligopoly is a monopoly of many.

Extracts from this document...


Name Class/ Teacher May 10, 2006 Oil Markets 1. All petroleum crude (oil) purchased or sold in the world is traded in three basic ways Spot Trading, Futures Market, and Contract arrangement. Spot transactions are on-the-spot agreements to buy or sell a single shipment at an agreed price. Since suppliers and buyers use these to bridge short-term gaps between supply and demand, spot market prices are good indicators of the supply and demand situation, rising prices indicating shortage and vice versa. There are spot markets for different products namely crude oil, heating oil, gasoline and so on, and for different regions such as Rotterdam, US Gulf, Singapore etc. Futures markets cover trades that are promises to sell and buy a consignment of oil of a specified quality, delivered at a specified place at an agreed upon price up to 18 months in the future. Very little, if any, oil changes hands physically in futures markets, these however, provide current prices and expected future trends and are more in the nature of financial transactions rather than physical trade in oil. The most important and active exchanges where such transactions take place are the New York Mercantile Exchange and the International Petroleum Exchange, London. ...read more.


Any disturbance in these conditions will lead to instability and markets will have to adjust to reach a new equilibrium point. The three scenarios in the oil market may be analysed as under: a. The Venezuelan Government persuades the OPEC to cut production quotas. Supply will reduce, but no change shall take place in the demand. The bold lines represent the demand and supply curves before the change. At equilibrium, a quantity Q1 sold at price P1. The decrease in supply, represented by the dotted supply line, is not matched by any decrease in demand. Therefore, the market will tend to find a new equilibrium represented by price P2 and quantity Q1 remaining same. In practical terms the demand may come down slightly as nations tighten their belts and the new price may be a little lower than P2 but not significantly so. b. The USA decides to build up its oil reserves. This scenario represents an increase in the demand for oil, not matched by any change in the supply position. Here the situation would be as represented by the following diagram. ...read more.


North Sea* 5,099 Angola 1,070 Argentina 726 Australia 465 Brazil 1,536 Canada 2,358 China 3,501 Colombia 532 Ecuador 490 Egypt 624 Gabon 238 India 669 Malaysia 748 Mexico 3362 Oman 781 Russia 8667 Syria 413 United States 5407 Other 5695 World ** 71741 (All production figures are in million barrels per year) * Consists of UK, Norway, Denmark, Netherlands and German offshore operations. ** OPEC Production is included. Appendix 3 The largest Exporters, Consumers and Importers of crude oil: Exporters Net oil exports Consumers Total oil consumption Importers Net oil imports 1. Saudi Arabia 8.73 1. United States 20.5 1. United States 11.8 2. Russia 6.67 2. China 6.5 2. Japan 5.3 3. Norway 2.91 3. Japan 5.4 3. China 2.9 4. Iran 2.55 4. Germany 2.6 4. Germany 2.5 5. Venezuela 2.36 5. Russia 2.6 5. South Korea 2.1 6. United Arab Emirates 2.33 6. India 2.3 6. France 2 7. Kuwait 2.2 7. Canada 2.3 7. Italy 1.7 8. Nigeria 2.19 8. Brazil 2.2 8. Spain 1.6 9. Mexico 1.8 9. South Korea 2.1 9. India 1.5 10. Algeria 1.68 10. France 2 10. Taiwan 1 11. Iraq 1.48 11. Mexico 2 12. Libya 1.34 13. Kazakhstan 1.06 14. Qatar 1. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level Marketing & Research section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level Marketing & Research essays


    Coca Cola Enterprises has a website that you can view information about where the stores are for the people who prefer to buy from the shops and not off the internet. It also supports people online. People who do buy off the website can track where their product that they have bought off the website is.

  2. business planning unit 8

    Financial plan For this business I will be investing in �35,000 and taking a loan out for 55,000. During the process of my business planning I also need to take into consideration the start up and running costs that will incur.

  1. Marketing Research

    Sequence of Questions : a) Do the opening questions win the interest of the respondent? The opening question should arouse the curiosity of the respondent as well as draw his interest towards the subject matter of the questionnaire. For e.g.

  2. Applied Business Studies

    Flint is getting bigger and bigger, so the population density and their population growth rate is increase drastically. There have been more plans for hotels to be made, and more houses to be made. This is a big advantage for my business, as I would have a variety of people who would have a reason to shop at my store.

  1. Unit 2 Investigating business

    http://www.buffetswithtlc.co.uk/ Choc in a box fountains http://www.choc-in-a-box-fountains-ltd.co.uk/ I used www.yell.com to find out about other local catering services in Medway, as there are no other businesses that offer the same services as us the closest thing to look at was catering services. Above is some of them that I found.

  2. Promotional Activities

    To provide information on different services of help, such as phone lines, websites, therapy etc., to people who suffer from mental health issues specifically to teenagers and for those around or close to the mental health patient. This would help a range of people who suffer from different mental health issues such as depression, anxiety, eating disorders and schizophrenia.

  1. Business Enterprise unit 5

    In addition it will be quick and easy to set up a car wash buisness, as I woud just need basic equipments such as shampoo, hoover and cleaning equipments and a suitable location. I have a keen interest in cars and I enjoy working with cars, so therefore car wash

  2. This is a report on the international dimension of Costa Coffee and Coffee Aroma.

    Costa?s range of delicious syrup shots includes vanilla, caramel and hazelnut (sugar free available).These include: 1. Americano- espresso with hot water 2. White Americano- espresso with hot water and hot milk 3. Cappuccino- espresso with steamed, frothy milk 4. Espresso- espresso shot 5. Hot Chocolate- chocolate with steamed milk 6.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work