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The Organization of Petroleum Exporting Countries (OPEC) is a cartel that attempts to keep oil prices high by restricting output. As part of that process, each member nation is assigned a production quota; most members have nationalized their oil industry so that the government controls overall production. However, member nations routinely exceed their production targets. Explain why OPEC often has difficulty keeping output low and prices high.
Public utility companies (you may stay with the topic of oil/gas) customarily charge more to business customers than to residential customers. Discuss this price discrimination as it relates to gas and oil.
What kind of changes do you predict will impact the oil industry based on the following trends in new energy sources: fracking, hydrogen fuel cells, biomass or bio fuel, solar, or a break-through in car batteries for electric cars? What are these market types and how does that matter to the pricing and production of oil.
For all of the industries that you discuss in this paper, state which of the four market types that it is (Perfect Competition, Monopoly, Monopolistic Competition or Oligopoly).
Ensure that you include Porter’s Five Forces Model in describing the pricing effects or strategies from these newer industries (or you may select one and discuss it in depth).