Case Study Analysis: Russia's Oil Export and Trade Strategies

This case study examines Russia's oil export industry, focusing on the strategies of LUKOIL and the country's overall trade dynamics. It applies the comparative advantage theory to explain Russia's competitive position in oil production and export, highlighting its vast oil reserves and lower production costs. The analysis also incorporates Porter's diamond of national competitive advantage to identify factors contributing to Russia's success. Furthermore, the study addresses the issue of dumping, its effects on domestic companies and consumers, and the rationale for government intervention in trade, including the role of the World Trade Organization. The document provides a comprehensive overview of the economic factors shaping Russia's oil export policies and their implications.

Running Head: CASE STUDY ASSIGNMENT 1
Case Study Assignment
Author’s Name
Institutional Affiliation
Date

CASE STUDY ASSIGNMENT 2
Case Study Assignment
Case Study 1
Question 1
It is undeniable that the comparative advantage theory supports Russia’s oil exportation.
According to this theory, under free trade countries will engage in the production of more goods
if they have a comparative advantage (Ren, & Ma, 2018). Now looking at Russia, it has a
comparative advantage because it has vast oil reserves, and it incurs a less cost of production to
produce oil. In essence, Russia has a relative advantage over other countries in oil production.
Due to the relative advantage of Russia in producing oil, one can apply this theory to explain its
oil exportation. Russia has a comparative advantage because it can export more of its oil without
worries of depletion or high cost of production, unlike some of its competitors.
Question 2
Porter’s diamond of national competitive advantage theory justifies the competitive
advantage a country may possess based on some factor, unlike other countries (Butt, Katuse &
Namada, 2019). Through this theory, one can look at factors that contribute to Russia’s
competitiveness in oil exporting. The theory can also help an individual understand a company
that has a competitive edge over other companies in the global arena. This theory can be used to
explain the competitive advantage of LUKOIL over other countries in oil exporting. In essence,
the theory can be used to describe how Russia has a competitive edge over other countries in oil
exportation. Besides, it can be used to elucidate the competitive advantage of LUKOIL over its
competitors.

CASE STUDY ASSIGNMENT 3
Case Study 2
Question 1
Domestically, dumping gives some companies access to cheap products. For instance, the
case study raises the issue of dumping of steel to the US, where General Motors is not
complaining. The primary reason the company is not complaining is that it is buying steel at
lower prices. This is likely to reduce the company’s production cost. Another effect is that it
hurts domestic producers. Dumping reduces the prices of commodities, and this broadly hurts
local producers (Bhasin, 2018). In essence, dumping benefits some business, especially those
that engage in auto-production in the case of steel dumping. On the flipside, some domestic
companies will be hurt due to lower prices arising from dumping. However, for consumers, they
will benefit from low prices. Dumping reduces prices and offers consumers a higher bargaining
power.
Question 2
In my view, this is a wise policy. The World Trade Organization does not directly
influence trade agreements between countries. Also, given that an individual government can
take a protectionist measure and ignore WTO, it is vital to allow states to punish companies
perpetuate dumping. Therefore, this is a wise policy because it will enable every government to
take control of its exports and imports.

CASE STUDY ASSIGNMENT 4
References
Bhasin, R. (2018). Anti-Dumping Duties and Trade Remedial Measures: The Case of Dumping
of Chinese Goods in India. VISION: Journal of Indian Taxation, 5(2), 104-112.
Butt, M. A., Katuse, P., & Namada, J. M. (2019). Demand Conditions According to Porter’s
Diamond and Competitive Advantage of Firms of Pakistan Automotive
Industry. European Journal of Business and Management Research, 4(5).
Ren, Z., & Ma, Y. (2018, October). The Significance of Comparative Advantage Theory and
Competitive Advantage Theory to the Development of China's Foreign Trade. In 2018
International Conference on Social Science and Education Reform (ICSSER 2018).
Atlantis Press.