Perfect and imperfect oligopolies
Some economists define perfection in oligopolies in terms of differentiation of products. In a "perfect oligopoly" such as the oil industry), there is little or no differentiation in terms of the products sold. In an "imperfect oligopoly" like the automotive industry), there's lot of differentiation between products. The idea is that perfect oligopolies pursue very different pricing strategies than imperfect ones.
From our perspective, the distinction is not so clear. Sellers of commodities like oil, milk, or coal are constantly looking for ways to differentiate their products. And indeed, there are distinctions to be made in lots of ways.
Crud e oil, for example, comes in a wide variety of grades, which is why Oseberg crude form the North Sea has a different price from Iran heavy and both are different than Girassol from Angola. There are hundred of types of oil that are evaluated by their useful in refining certain products and by the sulfur they contain. (For a sample list of some of them, take a look at this site.
Gasoline is indeed more of a natural commodity, but the major oil companies try like hell to differentiate their brands in terms of octane ratings and additives. And it must work, as the big gasoline companies have developed loyalties among drivers, even though it may be less than rational. (Remember Amoco' attempt to sell "Crystal Clear gasoline".) The gasoline comapnies certainly aren't gaining points for service in the US.
Milk is a commodity, in general, though even there, as we have seen, the trend is to differentiate categories not only by milk fat content, but also by selling organic milk and low-carb milk. In similar ways, meat companies are increasingly their products rather than just delivering generic chops ad steaks to the supermarket. Credit Perdue Chicken for inventing the concept of branding in the meat department.
On the other side of the equation, the principle of convergence is at work. When one company breaks out with distinctive features, they are often quickly imitated.
In the automobile industry, every popular new development (differentiator) is duplicated by almost all members within a year or two. So Toyota pickups and Mercedes SUVs are looking very America and Ford and Chevy sedans look every year more like their Japanese counterparts.
The same pattern is true in TV, computers, retailers, food companies, and so on. What's happening is that real distinctions are often short-lived as the market is attuned to replicating originality.
So, so called imperfect oligopolies get more perfect all the time, and the imperfect ones get perfect. The distinction is not a very clear one.
4:49:33 PM 
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