BP (British Petroleum) is one of the largest oil and petrochemical companies in the world by undergoing integrative recombination of enterprises Amoco, Arco/AMPM, Castrol and Aral. The company's main businesses conclude finding, extracting and moving oil and gas, as well as making and selling fuels and products (BP). The exploration and production are active in 29 countries and proved reserves achieved 18.1 billion barrels of oil equivalent (BP Annual Report and Accounts, 2008). The headquarters of BP's entire business is located in UK, the exploration and production of which makes up about 10% of company's global production (BP in UK). First founded in Iran and then spread to be an international enterprise (Mira Wilkins, 1995, p195-196), BP gradually became world famous for its high quality of provision of retail services and petrochemicals products for everyday items.
The essay analyzed several aspects in microeconomics and macroeconomics to assess the performance of BP's businesses and to give some recommendations of feasible strategies based on the analysis. In real life, many factors contribute to the demand and supply of crude oil, influencing the volatile price of oil. Therefore, the correlation between the price and demand/supply is not simply linear. Various statistics, derived from different issues, suggest that the price elasticity of crude oil is very low in both short term and long term (John C.B Cooper, 2003), which is an indicator that guides companies to maximize profit. Oil, not like the fast moving consumer goods, is traded in an imperfectly competitive market (Guillaume Chevillon, Christine Rifflart, 2007). The consumers are far more than suppliers, which situation leads to the oligopolistic oil market structure (Guillaume Chevillon, Christine Rifflart, 2007). Besides these microeconomic factors, some other ones, which are in the macro-level, also impact the oil market and BP's businesses. GDP growth to some extent influences the robustness in industry, which relies heavily on the consumption of crude oil. Government takes advantage of oil taxes to generate fiscal revenues, resulting in an impact that cannot be overlooked on oil price. Besides, exchange rate also affects oil demand and supply to alter the price.(责任编辑：BUG)