Business Studies - Case Study: British Petroleum (BP) - Assignment Example

In January 2006, BP was imposed a fine of $ 1.42 million for misconduct in safety at its Prudhoe Bay oilfield in Alaska. After two months, more than 1.2 million liters of oil was leaked a hole in an oil pipeline. In October 2006, CSB chairwoman blamed the explosion on BP’s lack of proper infrastructure. In November 2006, an US report stated that BP manager know the safety problem at Texas oil refinery before the explosion occurred. A 25% cut on fixed costs from 1998 to 2000 by BP lead to worn out equipment.

The report stated that the problem was known before March 2005 and still there were no steps taken to avoid the catastrophe. Timeline 1998-2000 BP cut its fixed costs which affected the maintenance of equipment 2004 two workers were killed by super-heated water 2005 March there was an explosion at BP Texas oil refinery 2006 January fine was imposed on BP for safety violation in Alaska 2006 March pipeline leaked 1.2 m liters of oil 2006 October CSB blames BP for being aware of the 2005 explosion 2006 November official US report clarifies the lack of responsibility of BP managers leading to safety shortcomings Market for Oil companies With the passage of time and the advent of information technology, the market for oil companies has shaped differently since the 1990s.

Advancements in seismic, deep water and reservoir technologies have opened up new areas of development. Moreover, national barriers have become relatively insignificant as more countries around the world involve in trade despite of geographical distances. The market for Oil has included new major players such as Russia, china, central asia and others. As the world becomes more industrialized there has been a rapid rise in the demand for oil. BP operates in six continents and serves to over 80 countries across the globe.

It operates in Africa where it has joint ventures with many local oil companies with respect to management support and training. When it comes to Asia, the exploration and production are focused upon china, Indonesia and Pakistan. Where as the chemical manufacturing is centered in china, South Korea and Malaysia. In India BP has a solar manufacturing plant and markets lubricants and oil products in this region. BP has major retail operations in Australia and New Zealand where it focuses its exploration and production as well as solar panels.

The headquarters of the company is located in the UK, which makes it the central point in terms of trading and all business functions. UK is the home of the company and this is where it has its biggest research facility. Within the UK the exploration and production covers the UK and Norway. The joint venture with TNK-BP (Oil Company) is located in Russia. There are also other exploration projects in areas such as Azerbaijan. Throughout Europe BP owns and has stakes in seven refineries. The chemical plants are also widespread in Europe.

When it comes to North America, BP is considered as the biggest oil and gas producer in the United States. BP is present in Canada, where it carries out natural gas production. BP has exploration and production plants in Trinidad and Tobago. Lastly, in South American region exploration and p