nd cheapest. They are finding new products and cheaper oil prices in Angola, Nigeria, and the U.S. With OPEC again raising crude oil prices the big oil companies are all being forced to explore again.Threat of SubstitutionThe oil industries biggest threat came in the 1970’s with the forming of OPEC. OPEC is made up of the leading oil producing oil countries and they set the price and output of the oil. In the 1970’s they decided to raise the price of the crude oil by quite a bit. Since oil prices are tied to the economy a great deal the world suffered a recession. Since this happened it forced the oil companies to find alternative suppliers. BP decided to start oil searches in the Alaska permafrost and the North Sea. This turned out to be an advantage and helped them through the tough times. Exxon looked towards Africa and the Gulf of Mexico. Exxon found excellent suppliers in the Gulf and were able to keep their prices at a decent level to its customers. They also expanded their stations to get the customers out quicker and easier. They added swipe cards on their pumps to speed up payment. They were determined to kill off their competition. Soon Mobil followed suit with their swipe cards and later on the rest of the industry would switch to the swipe card. Exxon was able to gain the competitive advantage by establishing new suppliers and keeping their buyers happy with added amenities. Since Exxon was the first in the industry they quickly profited from the new services. (ExxonMobil Official Website)BP found their niche in the market in natural gas when they explored in Alaska. They also where able to stay a float in their U.S. gas stations but lacked a vision. They were the slowest to update their stations and many stations didn’t add the swipe card. One service that differentiated them from Exxon, Mobil, and Chevron was the full service stations they had. They were the only ones who kept a lot of their full service...
