Abstract
International seaborne transport of crude oil takes place mainly on tankers, with annual seaborne crude flows totaling an estimated 12 billion barrels. To take into account the carbon footprint on crude oil from its international distribution segment, we utilize a micro-level dataset of more than 28,000 individual shipment samples to estimate each journey’s carbon emissions. The unique detailed dataset enables us to aggregate carbon emissions at the country level for importers and exporters, by trade lane, and by vessel size categories. Our methodology provides a framework for crude oil consumers to dynamically account for the carbon footprint of the commodity which is transported via different trade routes and by different vessels (size and age). So far, this dynamic emissions accounting has been largely neglected by oil consumers who typically apply one single emission factor regardless its supply chain. Our results highlight the importance for importers to consider the origin and point-of-use of crude oil in order to have a comprehensive view of its carbon footprint. The quantitative analysis in this study can feed into well-to-tank fuel emissions factors for oil and oil products in order to adopt dynamic emissions factors in companies' carbon accounting. Finally, our research is important for the design of new environmental policies for the corporate Environmental Social Governance (ESG) reporting to include downstream logistics in the overall emission accounting of oil companies.
Highlights
The oil and gas sector is responsible for significant greenhouse gas (GHG) emissions
Our methodology provides a framework for crude oil consumers to dynamically account for the carbon footprint of the commodity which is transported via different trade routes and by different vessels
Accounting for carbon emissions is becoming increasingly important to companies, governments, and international governing bodies as part of efforts to keep global temperatures below 2 degree celsius from pre-industrial times
Summary
The oil and gas sector is responsible for significant greenhouse gas (GHG) emissions Emissions arise from both the extraction, processing, transportation, and distribution of fuel (often referred to as the well-to-tank phase of the fuel life cycle) as well as the eventual combustion of the fuel in various applications like energy, heat, and transportation (the tank-to-wheel phase) (El-Houjeiri et al 2013; Greene and Lewis, 2019). Together, these stages form the well-to-wheel fuel life cycle. The primary mode of transport for intercontinental oil movement is by oil tanker, largely powered by marine diesel and heavy fuel oil (Jia, 2018)
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