Comparative Analysis between Hydrous Ethanol and Gasoline C Pricing in Brazilian Retail Market

Thiago B Murari,Paulo Ferreira,Hernane B.B Pereira,Sergio Pitombo,Marcelo A Moret,Eder J.A.L Pereira,Alex A.B Santos,Aloisio S Nascimento Filho

doi:10.3390/su11174719

Abstract

The global energy landscape is rapidly changing, including the transition to a low carbon economy and the use of liquid biofuel. The production of liquid biofuel has emerged as an alternative to the use of fossil fuels for purposes of energy conservation, carbon emission mitigation and agricultural development. In this article we study the co-movements between hydrous ethanol and gasoline C in the Brazilian retail market. A multi-scale cross correlation analysis was applied to the Average Retail Margin time series of hydrous ethanol for fifteen relevant retail markets in Brazil to analyze the competitiveness of hydrous ethanol towards gasoline C. The empirical results showed a remarkable different behavior between hydrous ethanol and gasoline C, for any time scale, regardless of geographical distance or regional differences.

Highlights

There is a consensus in the scientific community that human activity is related to global warming [1]
This paper aims to analyze the inequalities by comparing the co-movements of hydrous ethanol and gasoline C in the Brazilian retail market
The Average Retail Margin (ARM) signal is calculated from ARMw = rsw − cw, where rsw is the average price of hydrous ethanol in the retail market, cw is the average hydrous ethanol price wholesale, and the index w is weekly, measured over a period that ranges from 2005 to 2014, representing 517 weeks

Summary

Introduction

There is a consensus in the scientific community that human activity is related to global warming [1]. The burning of fossil fuels could have severe consequences, for the planet’s environmental balance. The challenges facing by the oil industry is to compete with clean energy sources, which are increasingly present in the world energy matrix. In the last decades discussions about the depletion of natural resources have intensified nations around the world, including the adoption of sustainable energy source, such as renewable energies [2,3]. The global community will continue to use fossil fuels during the transition to a low carbon economy, the global energy landscape is changing quickly as predicted by the International Energy Agency [2]. The demand for oil will continue to grow for trucks, aviation and petrochemicals [2,3]

Objectives

Methods

Results

Conclusion