Net Oil Importer Research Articles

Understanding the Crude Oil Price: How Important Is the China Factor?

This paper employs monthly data on China’s net oil import from January 1997 to June 2010 to assess the role of China’s net import in the evolution of the crude oil price. Based on a vector autoregression (VAR) analysis, we find that the growth of China’s net oil import has no significant impact on monthly oil price changes and there is no Granger causality between the two variables. The historical decomposition indicates that shocks to China’s oil demand have only played a small role in the oil price run-up of 2002-2008. We also calculate the price changes implied by China’s net oil import growth from a longer-term supply and demand shift perspective. doi: 10.5547/ISSN0195-6574-EJ-Vol32-No4-4 “Surging Chinese demand is underpinning the recent spike in the price of oil, figures from the International Energy Agency (IEA) show. This ‘China factor’ has more bearing on oil prices than the ‘risk factor’ coming from global tensions, some experts say” —CNN (2004) “The price of crude oil could soar to $200 a barrel in as little as six months, as supply continues to struggle to meet demand . . . Soaring global demand for oil is being led by China’s

Oil Import Diversification in Northeast Asia: A Comparison Between China and Japan

In this article, we explore why oil import patterns differ between states with a view to understanding the relationship between agent-based explanations such as strategy and structural explanations—for example, geography. We compare degree of diversification between China and Japan in an effort to explore the relationship between agency and structure in the formation of energy security policy. The China-Japan comparison is contextualized with reference to the baseline case of the United States, a well-diversified importer. We employ the Shannon-Wiener index of diversity to assess the extent of oil import diversification, and temporal changes in diversification for China, Japan, and the United States. A key finding is that China's statist approach has allowed it to diversify its sources of imported oil more quickly than Japan's hybrid approach. In fact, since becoming a net oil importer in 1993, China's sources of imported oil have diversified quite rapidly. Japan's overreliance on the Middle East for much of its imported oil has been endemic since 1973.

Life cycle GHG emissions from Malaysian oil palm bioenergy development: The impact on transportation sector's energy security

Malaysia's transportation sector accounts for 41% of the country's total energy use. The country is expected to become a net oil importer by the year 2011. To encourage renewable energy development and relieve the country's emerging oil dependence, in 2006 the government mandated blending 5% palm-oil biodiesel in petroleum diesel. Malaysia produced 16 million tonnes of palm oil in 2007, mainly for food use. This paper addresses maximizing bioenergy use from oil-palm to support Malaysia's energy initiative while minimizing greenhouse-gas emissions from land-use change. When converting primary and secondary forests to oil-palm plantations between 270–530 and 120–190 g CO 2-equivalent per MJ of biodiesel produced, respectively, is released. However, converting degraded lands results in the capture of between 23 and 85 g CO 2-equivalent per MJ of biodiesel produced. Using various combinations of land types, Malaysia could meet the 5% biodiesel target with a net GHG savings of about 1.03 million tonnes (4.9% of the transportation sector's diesel emissions) when accounting for the emissions savings from the diesel fuel displaced. These findings are used to recommend policies for mitigating GHG emissions impacts from the growth of palm oil use in the transportation sector.

Revisiting Egypt's Energy Policy

Egypt's oil and gas sector is one of the most strategic sectors in the economy being the single largest industrial activity in the economy, with exports of crude oil and petroleum products constituting 40% of Egypt's export revenues and 20% of its GDP. However, Egypt is currently trapped between dwindling oil production and increasing domestic consumption, a fact which threatens the country to become a net importer of crude oil as well as deprive it of strongly needed foreign exchange. Yet, Egypt has proven natural gas reserves and its future energy outlook seems to be more affiliated with natural gas especially for future export potential. Given these conditions, a restructuring of the sector is necessary for sustainable development. Suggested strategies in line with Egypt's development efforts are outlined including gradual reduction of energy subsidies and their expected impacts on the economy.

Energy and exergy efficiencies in the Chinese transportation sector, 1980–2009

Abstract This paper aims at analyzing energy and exergy efficiencies in the Chinese transportation sector. Historical data is used to investigate the development of efficiencies from 1980 to 2009. Firstly, we calculate energy consumption values in PJ (petajoule) for nine transportation modes of five transportation sub-sectors. Then, the weighted energy and exergy efficiencies for each transportation mode, calculated by multiplying weighting factors with efficiency values of that mode, are summed up to calculate the weighted mean overall efficiencies for a particular year. We find that: (1) In 2009, the energy consumed in transportation sector was 12179.80 PJ, whereas that was 589.25 PJ in 1980. (2) Highways transport was the biggest energy consumer, which consumed 82.0% of total transport energy consumption in 2009. (3) Up to 2009, the oil consumed by transportation accounted for 75.1% of that in the whole country, which is more than the net oil import. (4) The average overall energy and exergy efficiencies are found to be 21.22% and 19.95%, respectively. (5) A comparison with other countries showed that energy and exergy efficiencies of the Chinese transportation sector are slightly lower than those of Jordan, Malaysian, Saudi Arabian and Norwegian, and higher than that incurred in Turkish.

Decomposition analysis of energy consumption in Chinese transportation sector

The purpose of this paper is to identify the relations between transportation energy consumption and its impacted factors. We first analyze the current status of transportation energy consumption in China. Then, the logarithmic mean Divisia index (LMDI) technique is used to find the nature of the factors those influence the changes in transportation energy consumption. We find that: (1) In 2006, the transportation energy consumption increased by 7.63 times against that in 1980. (2) Up to 2006, the oil consumed by transportation accounted for 49.6% of that in the whole country, which almost equaled to the net oil import. (3) In the light of the increasing energy consumption intensity, the energy-utilization effectiveness of transportation sector has been declining gradually. (4) The transportation activity effect is the most important contributor to increase energy consumption in the transportation sector and the energy intensity effect plays the dominant role in decreasing energy consumption.

Oil-Price Boom and Real Exchange Rate Appreciation: Is There Dutch Disease in the CEMAC?

The paper employs a heuristic comparative approach suggested by Ismail (2009) to search for evidence of Dutch disease in oil-rich countries of the Central African Economic and Monetary Community (CEMAC). While these countries have benefitted from high international oil prices in recent years, they have also experienced relatively large real exchange rate appreciations, raising concerns regarding the presence of Dutch disease and casting doubts on their ability to achieve high growth and employment in the long run. To isolate from any dynamics related to the exchange rate regime, we focus on the 14 member countries that constitute the CFA franc zone. We separate them into net oil importers and net oil exporters and look at economic growth, the real exchange rate, and the agricultural and external sectors. Based on traditional models, our findings are broadly consistent with the presence of Dutch disease in the second group during the oil-price boom. Departing from these models yields mixed results, suggesting the need to employ a case-by-case approach.

Oil-Price Boom and Real Exchange Rate Appreciation: Is There Dutch Disease in the CEMAC?

The paper employs a heuristic comparative approach suggested by Ismail (2009) to search for evidence of Dutch disease in oil-rich countries of the Central African Economic and Monetary Community (CEMAC). While these countries have benefitted from high international oil prices in recent years, they have also experienced relatively large real exchange rate appreciations, raising concerns regarding the presence of Dutch disease and casting doubts on their ability to achieve high growth and employment in the long run. To isolate from any dynamics related to the exchange rate regime, we focus on the 14 member countries that constitute the CFA franc zone. We separate them into net oil importers and net oil exporters and look at economic growth, the real exchange rate, and the agricultural and external sectors. Based on traditional models, our findings are broadly consistent with the presence of Dutch disease in the second group during the oil-price boom. Departing from these models yields mixed results, suggesting the need to employ a case-by-case approach.

Optimal acquisition strategy for China's strategic petroleum reserve: a cost estimation study through dynamic programming

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.

Understanding the Crude Oil Price: How Important is the China Factor?

This paper employs monthly data on China’s net oil import from January 1997 to June 2010 to assess the role of China’s net import in the evolution of the crude oil price. Based on a vector autoregression (VAR) analysis, we find that the growth of China’s net oil import has no significant impact on monthly oil price changes and there is no Granger causality between the two variables. The historical decomposition indicates that shocks to China’s oil demand have only played a small role in the oil price run-up of 2002-2008. We also calculate the price changes implied by China’s net oil import growth from a longer-term supply and demand shift perspective.

The SEEDS of oil price fluctuations: A management perspective

In view of unreasonable oil price fluctuations, this paper reviews past researches to propose a SEEDS framework to analyze the forces that influence oil price fluctuations. The SEEDS framework discusses oil price fluctuations from the supply side, environmental protection side, economic side, demand side and substitute side. According to SEEDS, we believe the rapid increase in oil price is not good for both net oil exporters and net oil importers. Of course, nobody doubts that crude oil reserves are limited. We also believe that oil prices would continuously increase, but not double or triple within one year. The global economy cannot endure sharp increase in manufacturing costs and product prices. This would reduce consumption and production at the same time, followed shortly by financial market crisis. Recognizing the symbiosis of net oil exporters and net oil importers is very important; we believe that this framework will help people understand that rapid increases in oil price are dangerous to world economics. The SEEDS framework can also be applied to analyze the price fluctuations of bulk commodities. Key words: SEEDS, oil price, price fluctuation.

Web tool for the quantification of oil and gas corridors' socio‐economic risks

PurposeGreece is a net importer of oil and gas and is among the most vulnerable countries of the European Union (EU) on energy supply disruptions. Furthermore, is considered a “crossroad” of existing and forthcoming infrastructure for importing energy to the EU. The purpose of this paper is the presentation of the web tool that implements the developed methodology for the quantification of socio‐economic risks of oil and gas corridors. The tool is applied to the main present and future oil and gas corridors to Greece, and the related outcomes are discussed.Design/methodology/approachA structured and coherent review on the future and present oil and natural gas (NG) corridors to Greece was elaborated, based on desk analysis and collection of the related data from national and international sources. Factor analysis was employed for the quantification of socio‐economic risks of each energy corridor. Particular emphasis was laid on the tool's design, so as to be user‐friendly, combining intuitive menus and navigation throughout the steps of the system.FindingsThe calculation of socio‐economic risks of the main oil and gas corridors to Greece provides operative and measurable concepts for supporting energy‐modelling processes. Indeed, this paper provides useful insights on the factors affecting the smooth energy supply and the reliability of oil and gas supply options to the Greek energy system. Moreover, the presented web tool can be used as a reference point for the researcher working on energy supply risks quantification.Originality/valueThe introduction of the energy corridors perspective in the valuation of supply security is of significant importance, taking into account the constantly increasing energy dependence of EU countries. To the best of the authors' knowledge, a structured and coherent review of the future and present oil and NG corridors to Greece is not present in the international literature. In addition to this, the development of the web tool is a clear contribution towards the quantification of the economic and socio‐political risk analysis and a step forward of the existing studies.

Impact of the Introduction of Biofuel in the Transportation Sector in Indonesia

Indonesia faces serious energy problems; its status as an oil exporter has changed to that of a net oil importer. Additionally, a highly subsidized price of fossil fuels, combined with a high dependency on oil, burden Indonesia’s national budget. In 2006, the government enacted a Mix Energy Policy, which strives for a mixture of energy sources by introducing renewable energy into the existing energy systems. Among the several alternative renewable energy options, biofuel is perceived as having the most potential in Indonesia, due to favorable climate and the availability of land and technology. This paper assesses the impact of the introduction of biofuel in the transportation sector of Indonesia in terms of energy, economics and the environment. A linear programming model was built to simulate the impact of the introduction of biofuel. The author concludes that the introduction of biofuel may have a positive impact by partially replacing the oil used for domestic transportation, generating income due to export of excess production, creating jobs in several sectors, and reducing carbon emissions in a sustainable way. In the model, four scenarios are tested: under the scenario ‘land and technology’, with proper land allocation and technology development, biofuel production can reach 2,810 PJ/annum and reduce greenhouse gas emissions by 168 million tons/annum CO2-equivalent. Furthermore, a profit of 49 billion USD can be generated in 2025 (all maximum values).

Web Tool for the Quantification of Oil & Gas Corridors’ Socioeconomic Risks: The Case of Greece

Purpose – Greece is a net importer of oil and gas and is among the most vulnerable countries of the European Union (EU) on energy supply disruptions. Furthermore, is considered a “crossroad” of existing and forthcoming infrastructure for importing energy to the EU. The purpose of this paper is the presentation of the web tool that implements the developed methodology for the quantification of socio‐economic risks of oil and gas corridors. The tool is applied to the main present and future oil and gas corridors to Greece, and the related outcomes are discussed. Design/methodology/approach – A structured and coherent review on the future and present oil and natural gas (NG) corridors to Greece was elaborated, based on desk analysis and collection of the related data from national and international sources. Factor analysis was employed for the quantification of socio‐economic risks of each energy corridor. Particular emphasis was laid on the tool's design, so as to be user‐friendly, combining intuitive menus and navigation throughout the steps of the system. Findings – The calculation of socio‐economic risks of the main oil and gas corridors to Greece provides operative and measurable concepts for supporting energy‐modelling processes. Indeed, this paper provides useful insights on the factors affecting the smooth energy supply and the reliability of oil and gas supply options to the Greek energy system. Moreover, the presented web tool can be used as a reference point for the researcher working on energy supply risks quantification. Originality/value – The introduction of the energy corridors perspective in the valuation of supply security is of significant importance, taking into account the constantly increasing energy dependence of EU countries. To the best of the authors' knowledge, a structured and coherent review of the future and present oil and NG corridors to Greece is not present in the international literature. In addition to this, the development of the web tool is a clear contribution towards the quantification of the economic and socio‐political risk analysis and a step forward of the existing studies.

Cellulosic Ethanol and First Generation Bio-fuels: A Potential Solution for Energy Security of India

Diminishing world petroleum reserves and the impact of environmental pollution of increasing exhaust emissions have led to search for suitable alternative fuels. Scorching prices of petroleum based fuel (before global economic recession) and reduced biofuel cost due to advanced technological breakthrough, made biofuel competitive with conventional petro-fuel. India is fifth in the world in terms of primary energy consumption, accounting for 3.5% of world commercial energy demand. Rapid economic expansion will continue to drive up India's energy needs. India is projected to be the third in the world by 2025 in net oil import. It is a huge task to manage the energy security for meeting the aspirations of growing economy in India. The paper presents a comprehensive analysis of energy requirements in transport sector and the future projections. Paper further analyzes the role and the advantages of distributed energy based on Bio-fuels which may ensure India's energy security. Around 1% of the world's arable land, i.e., 14 million ha are used in 2005 for biofuel production. In 2030 the share is expected to rise to 2.5% and 3.8% for reference and alternative policy scenario, respectively. These projections are expected to evoke the famous ‘food-Vs-fuel’ debate more critically for developing countries like India with huge population load. Therefore it is the need of the time for integrated approach combining conventional bio-fuel with the next generation bio-fuel to provide a sustainable energy-food-environmental security for a country like India. Paper discusses in detail how and to what extent the conventional bio-fuel, and the second generation bio-fuel, lignocellulosic ethanol can help to arrive a balance between food and fuel requirements of growing Indian economy. The scientific analysis presented here, may serve as interesting basis for future energy policy formulation in this area.

Unlocking Australia's oil future—exploration to exploitation

Since 2000 Australia has ceased to be self-sufficient in terms of oil production and petroleum demand. As a net importer of crude oil it is expected that imports will continue to fulfil a growing percentage of the country’s liquid petroleum needs. Analysts are predicting a decline in oil production over the next decade with current producing fields and discovered resources failing to fill the gap created by rising consumption. In an increasingly gas focussed industry, oil is competing with both liquefied natural gas (LNG) and coal seam gas (CSG) projects for investment. As one of the top 20 oil consumers in the world, Australia’s growing demand for petroleum liquids continues to highlight the declining domestic supply. This poster will identify and review the various components that will play a role in arresting the predicted decline curve. Exploration success in frontier basins is crucial along with the development of discovered resources in mature regions. In addition, future near-field and satellite exploration, with developments using existing infrastructure, will be instrumental in the stabilisation of oil production. This poster will also highlight planned high-impact exploration wells and examine the effect that potential discoveries could have on the country’s petroleum resources. Australia’s oil future could see a reduced dependence on imported crude, resulting from frontier exploration success opening up new oil provinces. Future options for oil production also include a re-evaluation of oil prone regions using new technology to develop discovered reserves and target higher risk and overlooked plays.

China's oil use, 1990–2008

Over the past two decades, China's oil demand has risen steeply. In 1990, it was only about 25% higher than that of 1978, the year economic reform was introduced. By 2008, it had reached 396.0 million tons, roughly four times the 1978 level, making China the second largest oil user worldwide. The country became a net oil importer in 1993, and between 1993 and 2008, its net import dependency—a yardstick for energy security—soared from 7.5% to 50.0%. China's increased demand for oil has made the country a global energy player of critical importance. Although the literature on the global implications of China's oil use has proliferated, relatively few studies have attempted to examine “how China uses oil.” Hence, this study covers every oil-consuming facility and sector in China, exploring the patterns of, and factors involved in, oil demand by power plants, oil refineries, heat plants and, gas-works, and industrial, transport, agricultural, household and commercial sectors. It concludes that in virtually all sectors in China, oil demand will grow, with transport and industry leading the way.

Russia's evolving energy policy for its eastern regions, and implications for oil and gas cooperation between Russia and China

Cooperation between Russia and China began in the early 1950s when the Soviet Union provided China with the technology and skills required to develop a modern oil industry. This assistance was withdrawn in 1958 as Sino-Russian relations deteriorated. During the following decades, each country developed its oil and gas industries independently of each other. Russia became a major exporter of natural gas to Europe, whilst China became a significant exporter of oil, mainly to East Asia. This situation changed in the early 1990s for two reasons. First, the collapse of the Soviet Union triggered a transformation of policies and incentives within the newly independent states, including within the Russian Federation. Second, China itself was becoming a net importer of oil and was starting to understand the potential benefits of increasing the use of natural gas for its energy supply. By the mid-1990s, government agencies and energy companies in both Russia and China had identified that an undeniable logic existed for the construction of major oil and gas export pipelines from Russia to China.1 Such projects appeared to address a wide range of economic, commercial, energy and diplomatic priorities for both nations, not least because other forms of economic interaction were progressing only very slowly at that time.2 By the late 1990s, considerable optimism existed that decisions were imminent on a number of important projects, especially in relation to the construction of pipelines to bring oil and natural gas from Russia to China.

A model based on stochastic dynamic programming for determining China's optimal strategic petroleum reserve policy

China's Strategic Petroleum Reserve (SPR) is currently being prepared. But how large the optimal stockpile size for China should be, what the best acquisition strategies are, how to release the reserve if a disruption occurs, and other related issues still need to be studied in detail. In this paper, we develop a stochastic dynamic programming model based on a total potential cost function of establishing SPRs to evaluate the optimal SPR policy for China. Using this model, empirical results are presented for the optimal size of China's SPR and the best acquisition and drawdown strategies for a few specific cases. The results show that with comprehensive consideration, the optimal SPR size for China is around 320 million barrels. This size is equivalent to about 90 days of net oil import amount in 2006 and should be reached in the year 2017, three years earlier than the national goal, which implies that the need for China to fill the SPR is probably more pressing; the best stockpile release action in a disruption is related to the disruption levels and expected continuation probabilities. The information provided by the results will be useful for decision makers.

Chemical Composition and Uses of Indian Rose-ScentedGeranium (Pelargonium Species) Essential Oil - A Review

Rose-scented geranium (Pelargonium species; family: Geraniaceae; 2n = 77) is a multi-harvest, ever green, perennial aromatic crop (Figure 1) cultivated for its essential oil. It was introduced into India from France and was initially grown as an ornamental plant on south Indian hills. Cultivation of rose-scented geranium for its essential oil was initiated in 1954 on Nilgiri hills of Tamil Nadu 1, from where the cultivation spread to other parts of India. Presently, the crop is cultivated on a limited scale in south Indian States of Andhra Pradesh, Karnataka, Tamil Nadu and North Indian States of Uttar Pradesh, Uttarakhand and Himachal Pradesh. The crop is commercially cultivated in a number of countries, China being the major producer and exporter of the essential oil followed by Egypt. India has always been a net importer of essential oil. The imports rose from 7.6 tonnes in the late sixties to 160–180 tonnes (natural as well as reconstituted oils) 20. The shoot biomass on steam distillation yields the essential oil of commerce that is highly valued in the industry. More than 220 compounds have been identified and reported in the essential oil. The yield and chemical composition of the fragrant oil are influenced by number of factors.