Tuesday, July 10, 2012

Journal # 10: Competition in the Petroleum Industry


July 9, 2012

            My dad has been working under the petroleum industry ever since he graduated college.  First, he worked for Shell and eventually moved to Total Philippines.  As of today, he has already retired from his job but he now manages a gas station for Total.  With that, I grew up usually hearing about the price increase and the price fixing of gasoline.  My parents were able to emphasize to me that these changes significantly affects our daily living.  Thus, during our COSORES class for July 9, I was engrossed with the topic of monopoly and oligopoly because I can somehow relate to some parts of it, particularly in terms of the price fixing.  Every time we travel, my dad constantly compares the prices of gasoline (unleaded, diesel, and the like) and checks whether each company follows through with the price fixed for the day.  Honestly speaking, there are some companies, who do not abide by this, which I believe can be quite unethical because it becomes unfair for other gas stations. 
    
            The petroleum industry is, indeed, a crowded and mature market.  My familiarity with Total, Shell, and Chevron (the company that I interned last term) made me realize that this industry still has several unethical practices.  Fortunately, they do conduct Corporate Social Responsibility Actions; however, all of them must be strict when it comes to following price fixing.  This dilemma revolves around ethics and therefore, it is really up to the owner of the respective gas station whether to follow or not.  In my opinion, the area head for the company must be alert at all times and make sure that each retailer is observing proper ethical courses of actions.


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