The impact of country risk on energy trade patterns based on complex network and panel regression analyses

Abstract

As an important component of developing strategies for most countries, global energy trade is easily affected by country risk. Therefore, it is necessary to determine the impact of country risk on energy trade patterns. This study analyzes the trade patterns of energy importers and exporters from the network perspective, and further explores the impacts of different kinds of country risk (political risk and economic risk) on trade patterns in a global sample from 2000 to 2016. Network analysis shows that in the global energy market, countries have different roles and occupy different central positions, with China and Russia being the most important countries. Panel regression analysis reveals that country risk significantly affects the trade patterns of energy importers and exporters. Importers should focus on the negative impacts of the economic risk, which decreases the importers’ resource anti-control ability and worsens their relationships with important countries. For exporters, political and economic risk have a negative impact on their total trade volume and their resource control ability. This study suggests that countries identify their trade patterns and pay more attention to the driving force of country risk in the formation of energy trade patterns.