Oil Trade Research Articles

The macroeconomic impact of oil price volatility and import volumes

Nowadays, oil is not only a necessary energy for industrial development but also an important strategic resource for the international economy. Previously, many factors led to a sharp rise in international crude oil prices. Therefore, it is of great significance to explore the influence mechanism between oil price fluctuation and the macroeconomy. In this paper, the VAR model is used to quantitatively analyze the dynamic relationship between oil price, China’s GDP, China’s CPI and oil import volume, and the orthogonal impulse response analysis and Granger causality test are carried out.The results show that China’s crude oil import volume is the granger factor of GDP, that is, the early changes in China’s crude oil import can effectively explain the changes in China’s GDP. China’s CPI and GDP show a short-term inverse response, and the change in the data is more dependent on the data of the previous quarter. Given the above problems, this paper proposes that China should attach importance to the long-term stability of oil exploitation, reserves, and oil market, and maintain the stability of the oil trade market by adjusting macroeconomic and gasoline prices when necessary.

RENT, INCOME, AND TRADE: DOES TRADE MITIGATE THE NEGATIVE EFFECTS OF OIL RENTS ON ECONOMIC GROWTH IN OIL-EXPORTING COUNTRIES?

The present study investigates the relationship among oil rent, trade openness, and economic growth, and assesses the potential moderating role of trade openness in mitigating the adverse impacts of oil rents on economic growth. Dynamic panel data analyses were conducted on a sample of oil-producing countries spanning the period from 1990 to 2020. The study accounted for both cross-sectional fixed and time fixed effects. The findings of our study indicate that the presence of oil rent has an adverse impact on the growth of the economy. However, the degree of trade openness plays a moderating role in this relationship, resulting in increased rates of economic growth. The findings indicate that trade liberalization can function as a mechanism to diversify economies from dependence on oil rents and foster sustainable economic growth. The results of our study hold significant implications for policymakers in oil-producing nations who aim to attain sustainable economic growth and advancement.

Import and export resilience of the global oil trade network

Given the economic and geopolitical importance of oil, it is important to understand the resilience of the global oil trade network to shocks. In this paper, the aim is to analyze the global oil trade network structure and its resilience to shocks. First, the structure of the global oil trade network between 178 countries is determined. Second, the stability degree of all countries in oil export and import networks is calculated based on diversity principles. Third, we develop an index to estimate the effective share of each country in oil trade networks. The effective share index combines the country’s efficiency and trade share in crude oil trade networks. Finally, a resilience measure is introduced to simultaneously capture a country’s stability and effective share within the network. Results show that China, USA, India, Republic of Korea, Taiwan (China), Germany and Italy have a high level of instability while playing a significant role in the network, which yields a reduction in the import-side network resilience. Also, Saudi Arabia, Russia, Kuwait, Iran, Venezuela, Nigeria and Libya reduce the resilience of the global oil trade network on the export side. This is because when these countries experience instability, it affects their ability to produce and export oil, which in turn affects the global oil trade network.

Sustainable Bioavtur: A System Dynamics Approach to Addressing the Aviation Industry’s Environmental Impact

The global energy crisis, predominantly affecting fossil fuel sources, poses significant challenges to numerous sectors worldwide, leading to escalating fuel prices and rising costs of living and production. The aviation industry, in particular, faces severe repercussions as domestic avtur production fails to meet the soaring demand, jeopardizing economic profitability and energy security. To tackle these issues, this study employs a qualitative modeling approach using system dynamics to investigate the interconnections among social, economic, technological, and environmental components within the biofuels development system. The research highlights the urgency of implementing several measures, including land conversion restrictions, regulation of palm oil trade schemes, and technological advancements in bioavtur production in Indonesia, to mitigate potential adverse consequences. The findings underscore the aviation industry’s contribution to greenhouse gas emissions and emphasize the need for sustainable biovehicles. This study provides valuable insights for policymakers, scientists, and professionals in the agricultural environment, ecology, and resources field, offering strategies to address the aviation sector’s environmental impact while ensuring sustainable energy alternatives.

Dual issue of resources and emissions: Resources richness and Carbon Emissions with Oil rents, trade, and mineral rents exploration

Climate change is a global issue of paramount importance, posing significant challenges to the sustainability of our planet. The issue of climate change and its associated challenges have garnered considerable attention from researchers worldwide. The BRICS nations hold a significant position in contributing to global CO2 emissions. These countries have experienced rapid economic growth and industrialization, which have led to an upsurge in energy consumption and subsequent CO2 emissions. Natural resources play a crucial role in the economic development of nations, including the BRICS countries. However, the extraction and utilization of these resources can have significant environmental consequences, including CO2 emissions. Hence, understanding the impact of natural resource rents on carbon emissions becomes particularly relevant. This study aims to analyse the relationship between natural resource rents (forest rents, mineral rents, and oil rents) and carbon emissions in the BRICS countries over the period of 1989–2021. Using advanced analytical approaches, we find that resource rents, along with imports, and GDP are positively related with carbon emissions. The finding implies that the economic benefits derived from forest resources, such as timber production and ecosystem services, may contribute to increased carbon emissions through activities like deforestation and land-use changes. Moreover, we find that exports reduce CO2 while higher levels of imports are associated with higher levels of emissions in BRICS nations.

Evolution pattern of African countries' oil trade under the changing in the global oil market

Africa's oil trade plays a vital role in the global oil market, but it is more vulnerable compared to other regions due to its resource dependency. This study examines the evolution of African countries' oil trade in the context of the changing global oil market, aiming to shed light on the characteristics of resource-dependent oil trade in these areas. By utilizing global oil trade data, an oil trade network of African countries is constructed for the period from 2000 to 2020. The findings reveal that the comparative advantages of most African countries are primarily determined by their abundant resources, with the Gulf of Guinea and North Africa exhibiting greater revealed comparative advantages. However, the over-reliance on primary product exports leaves African countries susceptible to unpredictable changes in the global oil market. Furthermore, due to their single industrial structure, the control over resource flows within the trade network is significantly low for African oil-producing nations. The oil trade of African countries has formed distinct trade communities, including the Gulf of Guinea and North America, North Africa and European countries, and Angola, Sudan, and East Asian countries. These communities exhibit relative independence and self-reinforcement, influenced by factors such as the timing of market entry, international economic trends, energy demand and transformations in consumer countries, and geopolitical risks.

Palm Oil Downstream Strategy: Enhancing Indonesia's Bargaining Position in International Palm Oil Trade

Although Indonesia currently dominates 60% of global palm oil production, Malaysia holds a competitive advantage in certain downstream industries. Indonesia must focus on developing its palm oil industries to process crude palm oil (CPO) into higher-value products, serving both as exports and substitutes for imported goods. This research aimed to highlight the importance of Indonesia's development of downstream palm oil industries. This research employed quantitative methods such as Pearson correlation and Granger causality, as well as qualitative methods. 
 The result showed that the fluctuation of CPO prices in the international market is closely tied to the volume of CPO exports conducted by Indonesia. Achieving higher domestic CPO production by improving the productivity of independent palm oil farmers is crucial. By enhancing their productivity from 2-3 tons per hectare to 5-6 tons per hectare, CPO supply can increase by 8 million tons annually, equivalent to approximately 16% of the total production. Reducing export should be accompanied by increased domestic CPO utilization through downstream programs. 
 By capturing half of Malaysia's current market share of HS code 1516 (animal or vegetable fats and oil, hydrogenated, inter-esterified, re-esterified, or elaidinized, whether or not refined but not further prepared), Indonesia has the potential to earn approximately 1 billion USD per year in foreign exchange. The development of biodiesel, transitioning from B30 to B40, holds the potential to save approximately IDR 200 trillion in foreign exchange. This strategic focus on downstream industries would strengthen Indonesia's position in the international palm oil market.

A new look at the crude oil shocks and trade nexus: Evidence from bilateral trade between Korea and its three largest partners

This article examines the impact of oil supply, global demand, and oil-specific demand shocks on Korea's exports to and imports from its three largest partners: China, the United States, and Japan. We also account for world trade uncertainty in our analysis. Our findings shed light on the complex dynamics of oil price shocks, highlighting the importance of shock type, trading partners, and timing in determining their effects on Korea's trade. Moreover, we identify the significant role of world trade uncertainty in explaining short-term fluctuations in Korea's exports to its top three partners. These insights have substantial implications for trade modeling and policy analysis.

THE SAUDI ARABIA AND QATAR RELATIONS ON CONFLICT IN THE MIDDLE EAST REGION

ABSTRACT;
 Purpose: In this study, it will be studied how big the influence and role of Saudi Arabia and Qatar in the conflicts that occur in the Middle East region.
 Methodology/approach: In this study, the author uses the library research method by analyzing some of the data that the author takes from books, journals, and other reliable sources.
 Results/findings: The results of this study are the discovery of threats to political economy stability and Saudi Arabia's national interest over the alliance made by Qatar with Iran. In the conflict that occurred, Qatar strengthened its country's relations with Iran, especially in the realm of production of natural resources, oil and gas, LNG. The LNG cooperation was so successful that it was considered a threat to the stability of Saudi Arabia's oil trade.
 Limitations: The limitation in this research is because the research method carried out by the researcher uses the library research method. The author realizes that there are several aspects that the author may not be able to analyze. This happens because of the limitations of the authors in obtaining the data sources needed to analyze the topics in this study, namely the influence and role of Saudi Arabia and Qatar in the conflicts in the Middle East.
 Contribution: Hopefully, this research will become a reference for knowledge about the role and influence of Saudi Arabia and Qatar in the conflicts that occur in the Middle East region. In addition, the authors hope that this research can be used as a reference material for further research to be able to examine aspects that have not been discussed in this study.

Design and implementation of the price cap on Russian oil exports

Basic economics teaches that price caps are bad – limiting the price of a good distorts demand and discourages producers from supplying the market. So why did the Biden Administration, led by Janet Yellen, the consummate economist, champion a price cap on oil from Russia after it invaded Ukraine in 2022? The answer is that this price cap, implemented for crude oil in December 2022 and oil products in February 2023, differs significantly from the standard cap discussed in introductory economics classes. This paper explains these differences and describes the first six months this policy has been in existence. We provide background on Russian oil trade and describe the goals, structure, enforcement and economics of the price cap. We review the main concerns and contrast them with the outcomes observed to date.

Snake Oil and Gaslight

This article seeks to sidestep the dilemma of restricted access to oil company archives through a close examination of a heretofore underutilized source base: the fossil fuel industry’s own trade journals and magazines. These oil and gas industry trade publications have served to envelop their readership in what we would now call an information bubble. Still, it is important to highlight the contradictory tactics that trade industry publications effectively test-marketed in the 1960s and 1970s to nullify a perception of petroleum as hazardous to public health and the natural environment. Most paradoxical was how trade publications reinvented their industry both as not a problem for the natural environment and as the solution to all and any future problems faced by that environment. Unlike any other currently available source base, Big Oil’s trade publications offer insights into the timing and triggering motivations of the industry’s shift to self-representation as stewards of nature, as well as the rapidity and multidimensional comprehensiveness of the industry’s mobilization to develop counternarratives to potential critics. And not least of all, these publications reveal the fantastical lengths to which Big Oil was willing to go in its efforts to preemptively block the research and development of electric vehicles, principally by diverting to the imaginary prospect of a gasoline-powered but nonetheless “smogless” car. This history represents an early and previously unexplored chapter in the evolution of what we have come to recognize as corporate “greenwashing.”

Turkish Straits and an Important Oil Price Benchmark: Urals

The Turkish Straits is one of the busiest waterways in the World. Around 4% of the world’s crude oil trade passes through the Turkish Straits. We model the CIF Mediterranean price of Urals crude, one of the world’s most critical medium gravity crude brands that passes through the Turkish Straits. The empirical evidence provided here suggests that congestion (measured in terms of the waiting time for entering the Turkish Straits) increases the CIF Mediterranean price of Urals crude up to 5.05% and 3.09% for the İstanbul and Çanakkale straits, respectively. However, similar supporting evidence could be found for neither an important benchmark oil (Brent) nor Iranian Light, which has similar characteristics and can be considered a close substitute for Urals crude in the Mediterranean refinery market. This shows that the Turkish Straits have an important impact on the price of this important medium crude oil in world oil markets.

The non-linear impacts of crude oil prices and trade openness on the foreign income of Bangladesh

A Market based study was conducted in the high (Tanore Upazila) and low (Natore Upazila) drought prone areas over the period of twelve months with the aims to know the impacts of drought on the market. Drought inhibits production, the inflow of agricultural produces and food supply in high drought market areas. Availability, diversity, price and sources of plant species become more restricted by the severe drought. The high drought market area shows less availability of the produces with low diversity and high prices. These attributes arrest consumer’s behavior in food consumption patterns and restricted food supply in high drought market. Low drought market area shows normal production, regular inflows of agricultural produces. Mostly drought affects market in the Kharif-2 season. More local varieties were found in the low drought market during Rabi season. Appropriate drought forecasting in advance and drought insurance can protect production loss and ensure market supply. IUBAT Review—A Multidisciplinary Academic Journal, 6 (1): 61-76

Is Policy Greasing the Wheels of Global Palm Oil Trade?

Oil palm is the major source of edible oil and feedstock consumed in the world. This study examined the determinants of global palm oil trade with attention to the effects of trade policies using a gravity model, PPML estimator, and the data from 1988-2020. Palm oil’s dramatic trade growth in recent years can be attributed to the economic growth of large countries, the proximity of partners and policies. Trade agreements increased crude and refined palm oil trade by up to 8 and 4 percent of the global import value, respectively. Further, the effects of policy changes due to COVID-19 and the recent export ban in Indonesia are also quantified.

TBDQN: A novel two-branch deep Q-network for crude oil and natural gas futures trading

Algorithmic trading plays a significant role in the trade of crude oil and natural gas futures. In this paper we propose a novel deep reinforcement learning (DRL) algorithm, dubbed two-branch deep Q-network (TBDQN), to automatically produce consistently profitable and robust trading signals in crude oil and natural gas futures markets. The first branch exploits long-short-term memory (LSTM) module to discover potential features hidden behind many technical indicators; the second branch extracts intrinsic features from futures contracts, trading positions and OHLCV using deep neural network. The extracted features are fused together to form the state vector of Q-leaning. In order to facilitate the training of the TBDQN model learning, we design a novel reward function by incorporating both immediate and long-term rewards. Compared to other popular methods, the proposed algorithm demonstrates excellent performance on the evaluation criteria of annualized return and Sharpe ratio in the oil and gas futures markets, which proves the effectiveness of our method.

Modeling the systemic trade risk of crude oil from a network perspective, combined with a sentiment proxy

Introduction: Trade networks of crude oil are susceptible to cascade of initial shocks that increase systemic trade risks and threaten energy security. This study introduces a novel method of modelling systemic trade risk of crude oil which is combined with a sentiment proxy from a network perspective.Method: We construct sentiment instability to evaluate the uncertainty of crude oil trade in a country and use the PageRank algorithm to measure supplier diversity from a network perspective instead of direct trade partners.Result: At the global level, we show that the distribution of systemic oil trade risk has an obvious heterogeneity and a significant negative correlation between systemic trade risk of crude oil and trade volume volatility. At the regional level, we compare the systemic trade risk of crude oil between China and America and systemic trade risks show strongly significant correlations with the price volatility in both China and America. Furthermore, the structure of trade network can effectively reduce the systemic risk in America while it increases the systemic trade risk in China.Discussion: Our results can give a reason for an irrational practice of Chinese crude oil imports which are “buying when the price is rising and not buying when the price is declining”.

Research on the Role of RMB-denominated Oil Trade in Promoting RMB Internationalisation

With the development of the global economy and the continuous expansion of international trade, currency internationalization has become an important goal of monetary policies of various countries. In this context, China has become the second largest economy in the world, and promoting the internationalization of the RMB has become one of the urgent issues for the Chinese government to address. In recent years, the internationalization of RMB has achieved remarkable results, but the use of RMB is still limited in the international commodity market, especially in the oil market. This paper takes the RMB-denominated oil trade as an entry point to analyze its contribution to the internationalization of the RMB and its potential impact. The paper first explains the importance of oil trade to the global economy and analyzes the current situation of the oil market with the US dollar as the main settlement currency. As one of the most important energy sources in the world, oil occupies a pivotal position in international trade. However, for a long time, the pricing and settlement of the oil market has relied mainly on the U.S. dollar, which gives the U.S. dollar a significant dominant position in the global arena and also exposes other countries to the risks associated with exchange rate fluctuations in oil trade. Second, this paper analyzes theoretically and empirically the role of RMB-denominated oil trade in promoting RMB internationalization. Theoretically, RMB-denominated oil trade will help increase the demand for RMB in the international market, reduce exchange rate risk, and thus accelerate the process of RMB internationalization. The empirical analysis shows that in recent years, with the growing volume of China's oil imports and the advancement of RMB internationalization, RMB-denominated oil trade has achieved initial results, and some countries have started to adopt RMB for oil settlement. Then, the paper discusses the challenges faced by RMB-denominated oil trade and the policy measures that the Chinese government should take. In the current international financial system, the U.S. dollar is "entrenched" as an international currency, and it is not easy to realize RMB-denominated oil trade. The Chinese government should strive to improve the credibility and convertibility of the RMB, actively participate in international oil market rule-making, strengthen cooperation with major oil producing and marketing countries, and promote domestic financial market reform to create a favorable external environment for RMB-denominated oil trade. Finally, the paper concludes that RMB-denominated oil trade is important for RMB internationalization. By realizing RMB-denominated oil trade, it is expected to improve the position of RMB in the international market and create favorable conditions for RMB internationalization. At the same time, it will help promote global currency diversification, reduce the sensitivity of China's economy to external shocks, and achieve more stable and sustainable economic development.

Russian exports hold up, discounts narrow

Oil and Energy TrendsVolume 48, Issue 6 p. 3-5 FOCUS Russian exports hold up, discounts narrow First published: 18 June 2023 https://doi.org/10.1111/oet.13020Read the full textAboutPDF ToolsRequest permissionExport citationAdd to favoritesTrack citation ShareShare Give accessShare full text accessShare full-text accessPlease review our Terms and Conditions of Use and check box below to share full-text version of article.I have read and accept the Wiley Online Library Terms and Conditions of UseShareable LinkUse the link below to share a full-text version of this article with your friends and colleagues. Learn more.Copy URL No abstract is available for this article. REFERENCES 1 An EU/G7 (plus Australia, South Korea and others) import ban plus a $60/bbl cap on seaborne Russia-origin crude oil has been in place since December 5, while a $100/bbl cap on imports of Russian refined products, such as diesel, kerosene and gasoline, and a $45/bbl cap on products like fuel oil, went into effect February 5. Vessels cannot use western insurance or shipping services if they sell above these caps. 2 S&P Global. Saudi Arabia to carve out larger oil market share in Europe amid Russia upheaval. https://www.spglobal.com/commodityinsights/en/market-insights/latest-news/oil/111122-saudi-arabia-to-carve-out-larger-oil-market-share-in-europe-amid-russia-upheaval. Accessed May 26, 2023 3 Reuters. India to be largest source of energy demand growth to 2040-IEA. https://www.reuters.com/business/energy/india-be-largest-source-energy-demand-growth-2040-iea-2021-02-09/. Accessed May 26, 2023 4 Ameba. Remarks by Secretary of the Treasury Janet L. Yellen at Press Conference in Niigata, Japan. https://amebblo.jp/shinobinoshu/entry-12804144148.html. Accessed May 26, 2023 5 Energy Intelligence. Special Report: New Players Transform Russian Oil Trade. https://www.energyintel.com/00000181-1f7a-d59f-a3df-bfff74640000. Accessed May 26, 2023 Volume48, Issue6June 2023Pages 3-5 ReferencesRelatedInformation

Analisis Perspektif Hukum Internasional Terkait Willow Project yang Berdampak Bagi Iklim Dunia

Each country in carrying out its government must have certain goals, in general countries are oriented and focused on national interests that lead to the welfare and prosperity of the country. an agenda carried out by the United States (United States of America) as a national strategic project, namely the Willow Projects, this is a domino effect from Saudi Arabia (Kingdom Saudi Arabia) joining an association of multilateral cooperation of countries in various fields that are developing and leading namely BRICS (Brazil, Russia, India, China and South Africa). Saudi Arabia, which is the main partner in relation to the U.S. oil trade as a provider of oil trade, is now turning around to cooperate with BRICS. The impact of this happening was that the United States cheated by becoming the Willow Projects to be the solution to this problem in the midst of an international political dilemma. The Willow Projects is a United States drilling project carried out in the state of Alaska, this has an impact on the international world environment, if it is not governed by appropriate environmental law regulations. In conducting a scientific research, researchers use a method, namely the Empirical Normative method using a statutory approach.

Relationship between Inflation and Other Macro Economics Factors: Comparative Study of Germany, Japan and New Zealand

One of the major concerns in different countries today is to manage inflation and to manage the resources according to it. Even though there are many factors that affect economic growth that can affect inflation, the concern of this research is regarding Consumer Price Index. The first objective of this study is to investigate the relationship between the consumer price index and Agricultural Land, Urban Population, Trade, Military Expenditure, Primary Energy Consumption, Natural Gas Flaring, and Oil–Refining Capacity. This study includes time series data from 1980 to 2020. Johansen's cointegration method is used to find cointegration, and the significance of long-run and short-term variables is tested. The findings of this study conclude that in the case of Germany, normalized coefficients show consumer price index, Agricultural Land, Military Expenditure, Oil Refining Capacity, and Primary Energy Consumption have a positive and significant impact, Whereas Trade, Natural Gas Flaring, and Urban Population has a negative and significant impact on consumer price index. On the other hand, Japan normalized coefficients show that consumer price index, Agricultural Land, and Primary Energy Consumption have a negative and significant impact. Whereas Military Expenditure, Oil Refining Capacity, Trade, Natural Gas Flaring, and Urban Population have a positive and significant impact on the consumer price index, if we talk about New Zealand, their long run coefficient shows that the normalized coefficients show that consumer price index, Oil Refining Capacity, Trade, and Urban Population has negative and significant impact Whereas Military Expenditure, Primary Energy Consumption, and Natural Gas Flaring has a positive and significant impact on consumer price index. Similarly, the results of the Germany-adjusted coefficients show that Military Expenditure and Urban Population have a positive significant, while primary consumption and trade have a negative relationship with the consumer price index. According to Japan and New Zealand, Oil Refining Capacity has a significant and positive relationship with the consumer price index in the short run. The study, therefore, recommends that the governments of New Zealand, Germany, and Japan should take more initiatives to increase their urban population and trade because these activities help to decrease the inflation in New Zealand, Germany, and Japan.