Comments on: Back to Petroleum? http://climateinc.org/2009/08/back-to-petroleum/ The Business of Stopping Climate Change Tue, 27 Jul 2010 16:33:20 -0700 http://wordpress.org/?v=2.8.4 hourly 1 By: Vivek Rana http://climateinc.org/2009/08/back-to-petroleum/comment-page-1/#comment-96 Vivek Rana Mon, 26 Oct 2009 23:07:39 +0000 http://climateinc.org/?p=15#comment-96 It is not surprising to see companies doing 'flip-flop' on their business strategies. When oil was over $100, they were signing new initiatives for deep sea drilling, and then completely abandoned them once oil prices tanked below $50. But, I do agree that they will continue to focus on their core competencies and wait until a clear direction emerges in alternate energy sources. Wait and watch and buy smaller winning companies to build their own portfolio. Though I am seriously convinced that future will hold a major share for alternate energy It is not surprising to see companies doing ‘flip-flop’ on their business strategies. When oil was over $100, they were signing new initiatives for deep sea drilling, and then completely abandoned them once oil prices tanked below $50.

But, I do agree that they will continue to focus on their core competencies and wait until a clear direction emerges in alternate energy sources. Wait and watch and buy smaller winning companies to build their own portfolio. Though I am seriously convinced that future will hold a major share for alternate energy

]]> By: Ans Kolk http://climateinc.org/2009/08/back-to-petroleum/comment-page-1/#comment-33 Ans Kolk Sat, 22 Aug 2009 13:00:12 +0000 http://climateinc.org/?p=15#comment-33 A great piece, David, and the industry we studied together continues to be very interesting. Actually, recalling the evidence we found at the beginning of this century, the retreat of BP and Shell is not so surprising – they formed renewable business units but these needed to show profitability within 5 years or so. So now that this hasn’t worked out, and considering the overall economics (low oil price), it is back to (core) business, while reaping some reputational benefits and spreading (avoiding) risks of doing nothing. Apparently the cost of stopping now is smaller than that of sticking to it. Interestingly, wasn’t this what Exxon predicted in 2000 as well? That BP and Shell were in reality not so different in terms of core business, and that they were experimenting but if loss-making they would sell it? Not sure what conclusions to draw from this (e.g. about how to identify true strategic change), but it is indeed a convergence of both political and market strategies within the industry. A great piece, David, and the industry we studied together continues to be very interesting. Actually, recalling the evidence we found at the beginning of this century, the retreat of BP and Shell is not so surprising – they formed renewable business units but these needed to show profitability within 5 years or so. So now that this hasn’t worked out, and considering the overall economics (low oil price), it is back to (core) business, while reaping some reputational benefits and spreading (avoiding) risks of doing nothing. Apparently the cost of stopping now is smaller than that of sticking to it.
Interestingly, wasn’t this what Exxon predicted in 2000 as well? That BP and Shell were in reality not so different in terms of core business, and that they were experimenting but if loss-making they would sell it?
Not sure what conclusions to draw from this (e.g. about how to identify true strategic change), but it is indeed a convergence of both political and market strategies within the industry.

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