One strategy that firms in an oligopoly might consider is to form a cartel, in which they agree to operate as if they were one firm (a monopoly). In the typical cartel arrangement, all the firms in an industry agree that, as a group, they will produce the same output and charge the same price for the industry’s product as would a monopolist who controlled the industry. This will maximise the industry’s economic profit, which can then be divvied up on some mutualy agreeable basis.
This seems like a perfectly acceptable way for firms in an oligopoly to operate. There are only two problems with it:
1. Collusion to restrain trade and the forming of cartels, typically, is illegal.
2. If firms cheat on the agreement, the strategy will not work.