1. Evaluate the risk strategies of Phibro, Mobil, and Conoco (Are their strategies appropriate? Why? What would you suggest to them?)

Phibro’s strategy when entering the Russian oil market was to try to take advantage of being the first mover. As a new smaller firm within a large oligopolistic structure of the oil industry Phibro’s move was risky but potentially necessary to in order to move itself to a better position within the market. By moving into Russia first through a joint venture with VNG Phibro hoped to gain access to a significant source of scarce input crude petroleum
One of the main reason moving into new market is that a company has a specific expertise to share to allow it to gain a competitive advantage. While Phibro certainly had a capital to contribute to any venture its expertise in the oil industry was limited and it has been in operation only for less than ten years before it took on the White Night Project. This lack of expertise showed itself in the mistakes it made while entering the Russian market. First the company had trusted the Russian estimates of the available oil rather doing its own research. This was a costly mistake when it turned out that the estimates of available crude oil was too generous. Second the company entered into a contract that left it dependant of on its foreign partner. Phibro promised to provide capital to find the needed technology and services, while VNG would provide the feels and the infrastructure. This left Phibro with little control over how to work was implemented in Russia. It also left Phibro with a partner that was required to continue to selling oil to its traditional customers, which because of economic crisis in Russia could not afford to sell pay for the oil. Finally Phibro did not bring any other strategic partners into its agreement.
Phibro did make some positive steps. First, it attempted to