Oil Supply Chain Research Articles

Enhancing Resilience of Oil Supply Chains in Context of Developing Countries

Oil supply chains play a vital role in the day-to-day functioning of national economies and obstruction in its services can lead to dire consequences. For this purpose, it is imperative for oil supply chains to be on guard against all probable vulnerabilities and develop adequate protection mechanisms. This research study aims to identify the most important vulnerabilities for oil supply chains in the context of Pakistan, a developing country. Subsequently, these identified vulnerabilities were used to design a protection framework, embodying different supply chain capabilities. For this purpose, this study employs a hybrid Multi-Criteria Decision Making approach. Full Consistency Method (FUCOM) has been used to prioritise vulnerabilities and Fuzzy Quality Function Deployment (QFD) has been used to identify those capabilities that can ensure protection against these vulnerabilities. Results indicate that crude oil price instability, fuel price shocks, unpredictable demand, and information and communication disruptions are the most important and catastrophic vulnerabilities in the context of Pakistan’s oil industry. For mitigation of these vulnerabilities, oil supply chains need to incorporate real-time information sharing, visibility, e-procurement, traceability, and transparency as resilience measures. These recommendations are of considerable importance to Pakistan’s oil industry and policy-making authorities. Moreover, this study fulfils the research gap by focusing on enhancing the resilience of Pakistan’s oil supply chains, with the aid of MCDM techniques.

The Challenges of Palm Oil Sustainable Consumption and Production in China: An Institutional Theory Perspective

The emerging economies are the centrepieces in the sustainable consumption and production of palm oil (SCP). With the collaborative efforts of the European Union and some non-governmental organisations, producers are kept in the spotlight, and scrutiny has begun to sweep down the supply chain. Palm oil environmental liabilities are extended to the consuming countries and criticism of emerging economies is evident in the context of weak institutions and inadequate attention from interest groups. China, one of the major consumers of palm oil, encompasses almost every potential environmental performance issue at the end of the palm oil supply chain. Sherri Torjman’s six-step approach has been used to parse the constraints and contributions of institutional coercive, mimetic and normative drivers to the three goals of the economic, social and environmental performance of palm oil SCP. This paper investigates the relevant institutions in China and compares in detail the content of SCP-related elements in these institutions through desktop research. An institutional theoretical perspective is provided to take a more comprehensive look at the SCP challenges facing the palm oil supply chain in China whereby this paper aims to shed light on the linkages between the challenges and institutional drivers.

The impact of COVID‐19 on the interdependence between US and Chinese oil futures markets

The oil futures market plays a vital role in the global financial system, especially after the negative future oil price rose during the COVID‐19 pandemic. This paper investigates the COVID‐19 impact on the interdependence between the US and Chinese oil futures markets by extending the dynamic conditional correlation‐generalized autoregressive conditional heteroskedasticity (DCC‐GARCH) models with incorporating COVID‐19 variables and by applying vector autoregression (VAR) models. Our study reveals that the COVID‐19 pandemic enhanced the long‐run correlation between the two oil markets. In contrast, daily changes in pandemic severity had a negative effect on the short‐term transient correlation. Our results show that COVID‐19 changed the one‐direction causality from the US oil market to the Chinese market in the pre‐COVID period to a bidirectional causal relation between the two markets during the COVID period. It strengthened the volatility spillover effect from the Chinese to US markets. These findings are helpful to regulars' monitoring oil supply chain risk and investors' cross‐market hedging of spillover risks from a systematic risk perspective.

Food fraud vulnerability assessment in the edible vegetable oil supply chain: A perspective of Chinese enterprises

The adulteration of edible vegetable oil is simple, but the detection is difficult, so it is a common target for fraudsters. To gain insight into the fraud vulnerability of the edible vegetable oil supply chain and then take more targeted measures to prevent and mitigate food fraud, we assessed the perceived fraud vulnerability of Chinese enterprises using the SSAFE food fraud vulnerability assessment (FFVA) tool and further applied multiple correspondence analysis (MCA) and nonparametric tests (Mann–Whitney U test & Kruskal–Wallis test) to compare the differences in fraud vulnerability between tier groups. Food fraud vulnerability in the FFVA questionnaire consists of three key elements: opportunities, motivations, and control measures. The results show that (1) Fraud factors related to opportunities in the Chinese edible vegetable oil supply chain have an overall medium-high vulnerability, while those related to motivations and control measures have medium and low vulnerability, respectively. (2) Producers have significantly higher perceived fraud vulnerability in terms of opportunities and motivations than retailers. (3) In the comparison between companies and workshops of producers, the perceived fraud vulnerability was significantly higher for workshops in terms of motivations and control measures and higher for companies in terms of opportunities, indicating that workshops are more vulnerable to committing fraud driven by economics and business culture and that they lack adequate measures to control fraud, in addition to the perception by companies that they are more likely to be victims of fraud. (4) The perceived vulnerability to fraud varies by the scale of enterprises.

Bibliometric Mapping of Research on Life Cycle Assessment of Olive Oil Supply Chain

The olive oil supply chain and even its individual stages have been extensively investigated through life cycle assessment (LCA) in recent decades. Most practices of the olive oil supply chain have been associated with negative environmental effects, such as soil degradation, carbon dioxide emissions, air and ground pollution, and depletion of groundwater. The current work aimed to perform a bibliometric analysis, through a science mapping approach, coupled with a review on the life cycle assessment (LCA) studies of the olive oil sector, with relevance to the environmental impacts of agricultural and industrial practices of this food sector. A total of 110 documents published in 2008–2021 were analyzed and discussed. More than 78% of documents were released from 2015. The main Scopus categories relating to the topic analyzed were environmental sciences (25%), energy (18%), and engineering (17%). The most productive countries were Italy, Spain, and Greece. The cluster analysis identified three main research topics related to the “agricultural phase”, “oil extraction”, and “waste management and by-product valorization”. Most of the recent publications focused on the application of LCA to evaluate the environmental impact of innovative agricultural practices, sustainable control of parasites and weeds, wastes, and by-products valorization within a circular economy.

Understanding AI Application Dynamics in Oil and Gas Supply Chain Management and Development: A Location Perspective

The purpose of this paper is to gain a better understanding of Artificial Intelligence (AI) application dynamics in the oil and gas supply chain. A location perspective is used to explore the opportunities and challenges of specific AI technologies from upstream to downstream of the oil and gas supply chain. A literature review approach is adopted to capture representative research along these locations. This was followed by descriptive and comparative analysis for the reviewed literature. Results from the conducted analysis revealed important insights about AI implementation dynamics in the oil and gas industry. Furthermore, various recommendations for technology managers, policymakers, practitioners, and industry leaders in the oil and gas industry to ensure successful AI implementation were outlined. Doi: 10.28991/HIJ-SP2022-03-01 Full Text: PDF

Kesenjangan Rantai Pasok Kelapa Sawit di Lanskap Ketungau Kabupaten Sintang Provinsi Kalimantan Barat

Oil palm supply chain gaps in the Ketungau landscape of Sintang district, West Kalimantan province. The development of oil palm plantations in Sintang Regency has been rapid in the last decade. Sintang Regency has declared to implement sustainable oil palm plantations while still considering environmental sustainability aspects. Management of the oil palm trading system to be effective and efficient is the main indicator of sustainable oil palm plantations. Gap analysis in the trading system is an important effort as a basis for making various policies. The Gap Analysis of Oil Palm Supply Chain in the Ketungau Landscape, Sintang Regency, West Kalimantan Province is aimed to identify the gaps that occur between levels of oil palm trading actors in the Ketungau Landscape, Sintang Regency. The analysis is carried out using a comparison method between the current reality and the perspectives expected by the stakeholders. The results of the analysis show that in the palm oil supply chain in the Ketungau Landscape, gaps still occur at every level of the supply chain. The gap between independent oil palm smallholders and the government is the lack of assistance programs and capacity building for smallholders and improving the quality of infrastructure. The gap between the government and companies is that the government's supervision of palm oil business actors is still not maximal. The gap between independent smallholders and companies is that there is still no understanding between the two parties, especially regarding the quality criteria for FFB. The results of this study indicate that independent oil palm farmers in the Ketungau Landscape still require policy intervention from the government and oil palm companies.

Rotational cattle grazing improves understory vegetation biodiversity and structural complexity in oil palm plantations

AbstractHerbicide overuse decimates understory vegetation, including those beneficial plants which may lead to a reduction of some production‐related ecosystem services such as nutrient cycling, water regulation, natural pest control, and pollination. Such conventional weed management practices need to be replaced with environmentally friendly methods such as ecological grazing to make palm oil supply chain environmentally sustainable. Contrary to chemical weeding, livestock integration is believed to be a useful tool to control weeds without negative impact to human health and the environment. However, little is known about the influence of different livestock grazing practices on oil palm understory vegetation. Thus, the present study investigates the effects of weed management practices (i.e., rotational grazing, free‐ranged grazing, and conventional weeding) on understory vegetation species richness, composition assemblages, and structural complexity. Based on plant surveys that were conducted on 360 sampling points, 120 understory vegetation species consisting of grasses, sedges, ferns, and legume covers were recorded. We found understory vegetation composition assemblages were different between treatments. Results revealed that the number of understory vegetation species, coverage, and height were significantly higher in rotational grazing compared with other practices. Given the major contribution of vegetation composition assemblages and structure on palm oil productions and biodiversity, oil palm growers should adopt rotational livestock grazing as a part of an integrated pest management strategy to control understory vegetation.

Olive oil supply chain design with organic and conventional market segments and consumers’ preference to local products

Recent market studies showed that the demand for organic and local agrifood products is increasing despite their higher prices. The agribusiness actors should therefore rethink the supply chain configuration to cope with new market trends characterized by the rise of the organic segment and the increase of consumers' preference to more local products. This study focuses on the olive oil sector and proposes a mixed-integer non-linear optimization model for the design of olive oil supply chains while incorporating organic and conventional market segments and considering, for each segment, a supply chain proximity- and price-sensitive demand. The model is developed with the collaboration of olive oil producers in the Mediterranean area. Thanks to this industrial collaboration, we account for real-world practices and constraints and apply the model to a realistic case study. We first linearize the model and show that it can be efficiently solved with commercial optimization softwares. Based on numerical experiments, we derive a series of managerial insights that are applicable to the considered case study, some of them are not intuitive. For instance, we show that an increase in consumers’ preference to more local products may lead the producer to offer products with a more global supply chain. The conventional product variety may be produced with a more local supply chain than the organic (premium) variety. Finally, offering a mix of organic and conventional varieties instead of only one variety would lead to implementing a more local supply chain.

The Oil Palm Governance: Challenges of Sustainability Policy in Indonesia

Nowadays, Indonesian palm oil faces agrarian, environmental, and social issues and has been subject to sharp criticism from the international community for many years. To answer this problem, the Indonesian government implemented a strategy through certification which ensured the achievement of sustainability standards, especially on the upstream side of the palm oil supply chain. The implementation of Indonesian Sustainable Palm Oil (ISPO) was an ultimate instrument that applied in particular to smallholders oriented towards managing land legal issues, plantation business licenses, plant seeds, and environmental management and to farmer organizations at the local level. However, this process faced quite complex challenges in the form of structural barriers that are very constraining. This study revealed the occurrence of the phenomenon of hollow governance when regulations are absent or collide with each other. The study also revealed institutional power and multi-level governance that made the governance process ineffective or counterproductive. With a qualitative approach to research conducted in three important palm oil provinces of Indonesia, this article aims to look at the issues of oil palm governance a bit more comprehensively. The study conceptualized what was referred to as low-functioning governance to describe how weak the institutions, organizations, actors, and resources are that support ISPO implementation, especially at the regional and local levels. This paper suggests improving and strengthening the ISPO oil palm governance if Indonesian palm oil companies and smallholders want to gain better credibility on sustainability abroad.

Blockchain in oil and gas industry: Applications, challenges, and future trends

Today's systems, approaches, and technologies leveraged for managing oil and gas supply chain operations fall short of providing operational transparency, traceability, audit, security, and trusted data provenance features. Also, a large portion of the existing systems are centralized, manual, and highly disintegrated, which make them vulnerable to manipulation and the single point of failure problem. In this survey, we explore the potential opportunities and applications of blockchain technology in managing the exploration, production, and supply chain and logistics operations in the oil and gas industry as it can offer traceability, immutability, transparency, and audit features in a decentralized, trusted, and secure manner. We discuss state-of-the-art blockchain-based schemes, research projects, business initiatives, and case studies to highlight the practicability of blockchain in the oil and gas industry. We present the potential opportunities brought about by blockchain technology in various use cases and application scenarios. We present several systems that use blockchain-based smart contracts to automate critical services such as petroleum product tracking and tracing, international trade document protection, and coordination of purchasing and bidding activities for granting oil exploration rights to petroleum exploration and development companies. Finally, we present open challenges acting as future research directions.

The Effect of Supply Chain Management Practices on Corporate Performance in Libya Oil and Gas Industry

In this article, supply chain management practices (SCMPs) are examined to see whether they affect the performance of the Libyan oil and gas sector. The research is quantitative and is based on a survey using simple random sampling and data collection via a standard questionnaire. The surveys were sent to 479 individuals employed in the Libyan oil and gas sector, with an average service experience of 16 to 20 years. There were 86.6 percent of men and 13.4 percent of women in the sample. Descriptive statistics and structural modelling systems are used in conjunction with Smart PLS software to evaluate hypotheses about the relationship between variables. The findings of this research show that SCMPs are greatly and positively linked to the performance of Libyan oil companies. Financial performance (FP) was significantly and positively affected by three SCMPs: Strategic Supplier Partnering (SSP) 1 , Logistics Management (LM) 2 , and Information Sharing and Quality (IS & Q) 3 . As well as non-financial performance (NFP), of Libya's petroleum industry was significantly and positively affected by two SCMPs: SSP 1 and LM 2 . The findings of the study can be used to improve the oil and gas supply chain performance, and they show that more SCMPs can lead to better company performance. Furthermore, supply chain directors will learn about the implications of efficient and high-quality supply chain implementation practices in their companies' supply chains, such as: strategic supplier partnering, logistics management, information sharing and quality, and materials procurement and inventory management. This study complements the literature by looking at the association between supply chain management techniques and firm performance in the oil and gas industry.

Assessment of the Cholesterol-Lowering Effect of MOMAST®: Biochemical and Cellular Studies.

MOMAST® is a patented phenolic complex derived from the olive oil vegetation water, a by-product of the olive oil supply chain, in which hydroxytyrosol (OH-Tyr) and tyrosol (Tyr) and verbascoside are the main compounds. This study was aimed at investigating its hypocholesterolemic effect by assessing the ability to modulate the low-density lipoprotein (LDL) receptor (LDLR)/sterol regulatory element-binding protein 2 (SREBP-2), and proprotein convertase subtilisin/kexin type 9 (PCSK9) pathways. MOMAST® inhibits the in vitro activity of 3-hydroxy-3-methylglutaryl coenzyme A reductase (HMGCOAR) with a dose-response trend. After the treatment of HepG2 cells, MOMAST® increases the SREBP-2, LDLR, and HMGCoAR protein levels leading, from a functional point of view to an improved ability of hepatic cells to up-take LDL from the extracellular environment with a final cholesterol-lowering effect. Furthermore, MOMAST® decreased the PCSK9 protein levels and its secretion in the extracellular environment, presumably via the reduction of the hepatic nuclear factor 1-α (HNF1-α). The experiments were performed in parallel, using pravastatin as a reference compound. Results demonstrated that MOMAST® may be exploited as a new ingredient for the development of functional foods and/or nutraceuticals for cardiovascular disease prevention.

Development of a sustainability technical guide for the Italian olive oil supply chain

Italian olive growing must aim at the transition to economically and environmentally sustainable management systems, linked to premium quality production and to a recognized and remunerated context of biodiversity conservation in compliance with the provisions of the European Union New Green Deal and United Nations Agenda 2030. To assist and facilitate companies in this step, a sustainability technical guide for the Italian olive oil supply chain has been developed, with reference to the four pillars of sustainability. The guide, consisting of 42 requirements, was submitted to 18 olive farms from 8 different Italian regions participating in this pilot study, to assess their level of total sustainability and to receive feedbacks throughout the drafting process. Taken as a whole, the companies have proved to be virtuous in meeting the requirements provided, with percentages of compliance ranging from 86 to 96% according to pillar and from 70 to 100% according to company and showed a remarkable spirit of collaboration and involvement in the construction of the guide. In this regard, the text is aimed to represent a participatory standard for Italian institutions and for other olive countries.

The determinant of a five-stage downstream oil supply chain: An empirical study of Ghana

Background: The benefits derived from a downstream oil supply chain is very explicit and tangible. Various studies have looked at numerous determinants that drive the downstream oil supply chain, mainly among a specific player. However, the metamorphic nature of the industry powered by technological advancement, new policies, new oil well discoveries, and others raise an urgent need to assess the determinants of Ghana’s downstream oil supply chain. Therefore, this article scrutinises the five-stage downstream oil supply chain from the Ghanaian perspective.Objective: The key objectives of this study were to determine the determinant of a five-stage downstream oil supply chain and examine the impact of some of the identified determinants on the five-stage downstream oil performance.Method: The study adopted a quantitative research approach, and a closed-ended questionnaire was used to collect primary data from five-stage downstream oil supply chain players. The data collected was screened, coded and complied in Microsoft excel and analysed statistically using Statistical Package for the Social Sciences (SPSS) 20. A preliminary test was conducted to ascertain the data distribution (mean and standard deviation [SD}), reliability (Cronbach’s alpha) and validity (ANOVA [analysis of variance]). The logistics regression was applied to examine the impact of the determinant on the five-stage downstream oil performance.Results: The results suggest that government interference, human capital, collaborations, transportation issues amongst others are the determinants that affects the five-stage downstream oil supply chain. The logistics regression results revealed that each sector’s performance contributes significantly to the sustenance of the five-stage supply chain. Besides, government interference (political stability and expand industry growth) and human capital (educational level and training programmes) are the factors that affect the five-stage downstream supply chain. But as for collaboration, none of the factors adopted affect the five-stage downstream oil supply chain.Conclusion: In summary, the downstream oil supply chain player agrees that the sector’s performance is steady within the entire chain. However, government interference significantly affects downstream oil supply chain performance negatively. Besides, players within the five-stage downstream supply chain neglect collaboration (trust, information sharing, enabling technology and incentive alignment) and pay less or no attention to cooperation which is the cornerstone of daily operational improvement of the five-stage downstream supply chain.

Governing sustainability in the Thai palm oil-supply chain: the role of private actors

Private actors are essential partners in the sustainability governance of commodity-supply chains such as palm oil. However, their actual contribution to promoting sustainability is also contested. This article assesses the role of private actors in the governance of the palm oil-supply chain in Thailand by comparing supply-chain actors that are certified with the Roundtable on Sustainable Palm Oil (RSPO) standards and non-certified supply-chain actors. The comparison entails input supply and production, collection and sales, processing and storage, and distribution. Building on the concept of (global) value chains, we examine the following governance dimensions in our comparison: the management of contracts and agreements, the role of trust in transactions, the relative power of various actors, and the control over smallholder farmers’ access to the market. Primary data were collected in the Surat Thani and Krabi Provinces in southern Thailand. We found that the RSPO-certified palm-oil chain was shorter, more transparent, and that farmers received higher prices than the non-RSPO-certified chains.

A decision support system for sustainability prioritization of air pollution control technologies in energy and carbon management: Oil & gas industry of Iran

The environmental, economic, social, and technical challenges associated with implementing the air pollution control technologies (APCTs) in oil, gas, and petrochemical industries (OGPIs) necessitate a sustainability prioritization analysis. Environmental issues, economic parameters, social concerns, and technical performances all must assessed and weighted. Accomplishing such a crucial decision with rigorous potential environmental, economic, social, and technical effects needs a robust decision support system (DSS) for guiding the sustainability prioritization process of the technologies. This study purposes in developing a hybrid DSS by integrating the analytical network process (ANP), decision-making trial and evaluation laboratory (DEMATEL), and multi-objective optimization on the basis of ration analysis (MULTIMOORA) methods based on the fuzzy set theory for sustainability prioritization of implementing APCTs. Three cases of the petrochemical plant, gas refinery, and oil refinery in Iran are selected to assess and prioritize the most commonly used of APCTs including four alternatives of Electrostatic precipitators, Fabric filters, and Wet scrubbers, and Cyclones by the proposed DSS. The sustainability ranking of implementing the four technologies sequentially for three cases is obtained. The suggested DSS is feasible for group decision-making based on experts’ opinions and uncertain data. It can assist the stakeholders/decision-makers to attain the energy and carbon management (ECM) policies in three cases and apply to advance the oil & gas supply chains towards the targets of sustainability, green growth, and low-carbon economy. Finally, sensitivity analysis indicates the robustness of the proposed approach for the prioritization order.

Impact of horizontal mergers on supply chain performance: The case of the upstream oil and gas industry

Mergers are complex, and expected gains and success are highly dependent on different factors and drivers that affect supply chain efficiency. This paper describes a mathematical programming approach to address potential synergistic gains after horizontal mergers in the upstream Crude Oil Supply Chain (COSC). A supply chain optimization model is used to evaluate the extent to which economies of scope and economies of scale favorably impact potential mergers. The problem is formulated as a mixed-integer linear programming (MILP) model that determines the investment level and efficient implementation of operational strategies at shared services, as well as production and processing of oil and gas. A real case example from the oil and gas industry in the Middle East region is used to validate the model. The experimental studies examine three scenarios: merger under economies of scale, merger under economies of scope, and merger under the joint economies of scope and scale. Results reveal the impact of different operational strategies on potential synergistic gains. For this case study, computational results show that when only economies of scale are performed, the COSC fails to achieve the targeted cost/barrel (cost/bbl) after the merger. The joint performance of economies of scale and scope in reducing shared services costs at different supply chain echelons leads to a substantial synergy gain. It reduces the cost/bbl to below the target value.

A Review on Life Cycle Assessment of the Olive Oil Production

Olive oil is one of the most globally recognized high-value products, with 4 million hectares cultivated in the Mediterranean area. The production process involves many stages: farming, extraction, packing, and waste treatment. Each one of these stages should present critical points for the environmental impacts, and for this reason, the entire sector is adopting mitigation strategies to begin to be more sustainable. The mitigation actions’ efficiency should be evaluated through environmental indicators or environmental impact assessment by Life Cycle Assessment (LCA). This review aimed to carry out an overview of recent papers (2011–2021) involving an LCA study in the olive oil supply chain by giving a framework of what is included in LCA studies and highlighting the main contributors to environmental impacts. The main scholarly literature databases have been exploited, highlighting a great increase in publications, especially from the producer countries. The review results reflect the heterogeneity of the production process. However, the use of pesticides, fertilizers, water, and fuel for machinery heavily weigh on the farming stage’s environmental impact. Finally, special focus was given to key elements of LCA studies in the olive oil supply chain, such as functional unit, system boundaries, impact categories, calculation method, and software widely used.

Disruptions in the Upstream Palm Oil Supply Chain

The COVID-19 pandemic had a global impact since it was first discovered in late 2019, in Wuhan, China. According to the World Health Organization (WHO), COVID-19 has affected over 179 million people and killed approximately 3.9 million people in more than 200 countries across the globe (WHO,2021). This outbreak has not only affected people’s lives but also disrupted global supply chains. It has shown significant effects on businesses, consumers, and the global economy. Fear of the virus has led to many companies scrambling to respond regarding employees’ job security, ensuring supply security, risk mitigation strategy, and addressing market uncertainties that are driving down demand. Broadly, the objective of this article is to highlight issues faced by the upstream palm oil supply chain actors during this pandemic. Based on the problem, the study concluded that some forms of actions (short-term & long-term) have been proposed to ensure an agile palm oil supply chain.