Abstract
China is currently establishing a strategic petroleum reserve (SPR) to ensure its energy security. The stated government goal is to build up an SPR equivalent to the amount of 90 days of net oil imports by 2020. To build up an SPR needs a large amount of funds. How to determine the optimal acquisition strategy to reduce the total cost as much as possible is a challenge for China. Furthermore, in the process of establishing the SPR, there are many uncertain factors. This paper employs the dynamic programming (DP) method to determine an optimal acquisition strategy and to evaluate the total cost for establishing China's SPR. The impact of varying a number of uncertain factors on the results is also examined. The results would be helpful for policymakers in China to develop a better scheme for strategic stockpiling for China's SPR.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
