6.

Industry and Competitive Analysis

6.1. Porter’s Five Forces

6.1.1. Threat of New Entrants

Compared to other businesses, downstream oil industries may be hard to penetrate. The reason behind
this is that in order to establish an oil/petroleum company, it need massive capital investment. Creating
refineries and developing a supply chain mechanism requires a great deal of investment. Therefore, new
entrants find it very difficult to establish business. Apart from the financial requirement, the new
entrants will also have to deal with the presence of already existing and large-scale oil companies.