World Oil Market Research Articles

Drivers of United States oil footprints trajectory: A global assessment

Abstract The United States is the world's largest oil user, and its changes in oil consumption affect the participating countries in the world oil market. With the process of trade liberation rapidly deepening, better understanding the oil consumption requires to investigate oil footprint. However, the existing U.S. oil consumption researches have been almost monopolized by production-based oil consumption within sovereign geographical boundary. To fill the research gap, trajectory of evolution and key driving factors of oil footprints in the United States, the global biggest oil user, are investigated and analyzed by combining multi-regional input-output model with structural decomposition analysis (MRIO-SDA). The results show that the consumption-based oil footprint has been higher than the production-based, and the gap between the two has increased by 2.68 times in 1995–2011. Meanwhile, the embodied oil import dominates the US consumption-based oil footprints, and its proportion has increased by 10.46% in 1995–2011. The US embodied oil imports are mainly from China, Russia, Canada, and South Korea and dominated by manufacturing sector. The final demand scale is the main reason for the increase of US oil footprint. And the import effect of intermediate products from other economies is a major factor in promoting the increase in embodied oil imports. But this is mainly offset by technique effect. Therefore, the best policy to reduce US oil footprints is to further improve oil efficiency in the US and its major traders.

World Oil Market: Prices Have Stabilized

OPEC+ agreements aimed at cutting oil production have became a significant factor affecting world oil prices. Implementation of these agreements led to the rise of global oil prices to $60-70 per barrel. In early July OPEC+ decided to extend current restrictions on oil production for another nine months. On the back of growing oil production in the US and slowdown of the global economic growth this decision will be a stabilizing factor for the world oil market.

Technology foresights for coal industry in Russia up to 2040. Part I: Forecasts of Coal Production and Prices by Price Scenarios on the World Oil Market up to 2040

Technology foresights for coal industry in Russia up to 2040. Part I: Forecasts of Coal Production and Prices by Price Scenarios on the World Oil Market up to 2040

Regime switching in the reactions of stock markets in Saudi Arabia to oil price variations

AbstractThe study revisits the stock–oil nexus by examining the reactions of equity markets to oil price shocks at national and sectoral levels for Saudi Arabia in a time‐varying framework by employing the Markov switching EGARCH model developed by Henry (2009, Journal of Banking and Finance, 33, 405). Based on weekly data, the findings reveal that the behaviour of all stock markets switches between an expansion regime and a recession regime, with more persistence for the expansion state. Additionally, influential international events associated with stock market drops are clearly identified in the recession regime. Furthermore, there is evidence of asymmetric reactions of the equity index returns and the probabilities of transition from one state to another to oil price variations, with heterogeneous impacts across sectors and regimes. The stock markets are more sensitive to oil price decreases than to oil price increases. Although the evidence of relatively slight differences in some findings across weekdays, the study allows investors and policymakers to understand well the interactions of stock sector markets vis‐à‐vis the world oil market in a regime‐switching framework, in order to make the right decision as regards portfolio diversification and regulation of the stock markets.

Oil price shocks, economic policy uncertainty and China’s trade: A quantitative structural analysis

This article studies the effects of oil price shocks and economic policy uncertainty on China’s trade. We find oil supply and economic policy uncertainty shocks can significantly decrease China’s real export while oil aggregate demand and oil specific demand shocks can significantly increase the real export. Meanwhile, oil supply and oil aggregate demand shocks can significantly increase China’s real import. In addition, oil aggregate demand and oil specific demand shocks can significantly decrease the Chinese trade terms, whereas economic policy uncertainty shocks can significantly increase the terms of trade. We also detect that economic policy uncertainty shocks play the most important role in accounting for the variance of real export, import and terms of trade. Finally, we uncover that the sharp decrease in China’s trade during the period 2008Q4-2009Q3 can be largely explained by shocks in the world oil market, while the decrease in China’s trade in the period 2014Q4-2016Q1 is mainly driven by global economic policy uncertainty shocks.

New Kid on the Block? China vs the US in World Oil Markets

China has recently overtaken the US to become the world largest importer of crude oil. In light of this fact, we formally compare contributions of demand shocks from China, the US and the rest of the world. We find that China’s influence on the real price of oil has increased over the past two decades and surpassed that of the US. Despite this result, oil prices are more sensitive to demand shocks from the US than China. Finally, we document that demand shocks from China alone were too small to have caused the mid 2003-2008 price surge. Instead, oil specific demand shocks are found to be the major determinant of the real oil price during this period.

Mérsékelhető-e Óroszország európai geopolitikai aktivitása az olajár mesterséges befolyásolása révén?

Among the geopolitical challenges facing Europe – as has been the case in history – is now one of the most important threats facing Russia. Russia is increasingly aware of the use of hybrid warfare tools in Europe as well as of traditional military actions: annexation of Crimea, its military aircrafts regularly violate the airspace of European countries, launched military operations in Syria seriously violating of European interests.Due to the significant Russian army and nuclear weapon arsenal, direct military conflict is not a real alternative to act against aggressive geopolitical activity of Russia, so European countries have to act in a different way against hostile Russian actions. Beside intelligence (secret services) and IT protection, the tools of economic warfare should also be considered. As a result of annexation of the Crimean Peninsula, several economic sanctions have been imposed onRussia since 2014, but other economic warfare instruments may also be considered.In my research, I investigated whether the artificial influence of oil prices could be an effective economic warfare tool against Russia's actions violating European interests. Analysing oil market data and military spending database linear regression relationship can be discerned between the price of crude oil and the evolution of military spending of Russia. So, the average negative effect on Russian military spending of 1%fall in oil prices can be quantified. According to my research results, European countries alone do not have sufficient economic potential to induce a sustainable and significant price drop on the world oil market, nevertheless in alliance with its allies–first of all the United States –it can/could be an effective geoeconomic tool against hostile Russian geopolitical steps. &nbsp

Neftin müasir dünya siyasətinə təsir imkanları

Oil plays an important role in world politics. Opportunities for a significant impact of oil on the modern politics of world states continue to remain significant. On the other hand, it should be recognized that despite the availability of alternative energy sources in the world, there is primacy in their ranks. Interstate energy diplomacy has become an important factor in modern world politics, including in the first two decades of the 21st century. Energy resources occupy one of your most important places in political and economic relations between countries. Energy is not only one of the most important places, but also has a certain significance for the protection of the national interests of world states. The oil potential of the member countries and non-members of OPEC, which actively participate in its work, remains unchanged. Therefore, OPEC has a great influence on the regulation of prices on the world oil market.

Peculiarities of Applying the Theory of International Business by Russian Oil and Gas Companies

The article is devoted to the specific use of theoretical and methodological provisions of the international business of domestic oil and gas companies in practical entrepreneurship. It addresses the following issues— the importance of the agreement of OPEC+; international oil and gas business as a system, criteria of allocation of categories of oil and gas majors; options indicators and international megaprojects; the changing of the vector of cooperation of high-profile domestic companies with foreign partners. The implementation of the agreement will change the balance of supply and demand in the world oil market. As a result, prices will rise to 58 to 63 dollars per barrel. This price is acceptable for the domestic core businesses, and for Russia, which is one of the main manufacturers and main suppliers of this resource. However, probably the level of prices can persist for a relatively short period because this indicator affects a large number of factors. It has been established that the participation of foreign companies in business projects is beneficial for Russian companies, since they are investors and innovators, which help to accelerate the development of deposits or the construction of infrastructure facilities. It is determined that the most important parameter, which can characterise the position of a major, is a high level of competitive advantages, which is measured by indicators linked to a specific year. The conclusion is that the Russian specialised companies successfully adapt to new macroeconomic conditions, including prices for hydrocarbons and increase their competitive advantage, increase production efficiency, increasing the volumes of supply to world markets.

Macroeconomic problems of the oil-exporting countries in the conditions of instability on the world market

Macroeconomic problems of the oil-exporting countries, determined by the instability on the world oil market are still a significant factor affecting the development and socio-economic situation in this group of states and their economic policies. This is especially pronounced in the context of falling world oil prices, when for oil-exporting countries the question of restructuring the economic structure dependent on the oil factor arises with particular urgency. However, the global system of international division of labor imposes serious structural constraints on opportunities and rates of structural economic reforms. At the same time, despite the peculiarities and diversity of the manifestations of macroeconomic problems in various oil exporting countries under the fluctuations in the oil market conditions, similar difficulties in the field of financial, economic, structural and foreign economic policies are manifested.

Пути повышения конкурентоспособности России в нефтегазовой промышленности

Improving the competitiveness of the Russian Federation in the oil and gas industry – is one of the most pressing problems of today. Oil and gas – the most popular resources in the world. On this basis, in the highly competitive Russian companies it is not easy to manage to maintain its position in the world oil market. In this article the analysis of competitiveness in the Russian oil and gas industry is considered and some ways to improve the competitiveness of the Russian oil and gas companies in the world are studied.

Современные тенденции развития мирового рынка нефти

Oil – a valuable energy resource, has an enormous impact on the world economy. According to the latest statistics global oil reserves will last 42 years, but with the development of new technologies it made possible the development of hard-to-reserves, which will help to extend the use of such a valuable energy resource for the long term. This article describes the main trends in the global oil market and analyzes the current situation on the world oil market.

Oil Price Volatility, Exchange Rate Movements and Stock Market Reaction: The Nigerian Experience (1985-2017)

Given the observed volatility in crude oil prices in the international oil market and the role which oil and gas play in the Nigerian economy, this paper is an attempt to investigate the impact of crude oil prices and foreign exchange rate movements on stock market prices in Nigeria. In addition, the paper examined whether there is any volatility pass-through between the dollar price of Nigerian crude oil, foreign exchange rate of the Naira and stock market prices respectively. Data employed for the study are monthly values of the Nigerian Stock Exchange (NSE) All-Share Index (ASI), Dollar price of Nigerian Crude Oil (DPO) and the Official Exchange Rate of the Naira to the US Dollar (FXR) from January, 1985 to August, 2017. The methodology adopted for the study include the ADF unit root tests, Johansen co-integration tests, the ECM technique, Granger causality tests, variance decomposition as well as the GARCH(1,1) to model the volatility relationships among the variables. Findings reveal that there is one long-run dynamic co-integrating relationship among the variables ASI, DPO and FXR while the ECM results indicate that Crude oil price (DPO) significantly impact on Stock market prices. The Granger causality test reports a bi-directional causality relationship between ASI and DPO and a unidirectional causality running from FXR to ASI. The ARCH-GARCH volatility analysis demonstrates vividly that stock market prices in the NSE exhibit ARCH effect with a significant and positive first order ARCH term. The GARCH term is also positive and significant indicating that previous month’s stock market price volatility significantly influences current stock market volatility in the NSE. In addition, findings show that the volatility of dollar price of Nigerian oil (DPO) in the world oil market is significantly transmitted to the volatility of stock market prices in Nigeria. The pass-through effect of the volatility of exchange rate (FXR) to the volatility of stock market prices is also positive and significant. These findings offer significant informational signal to policy makers, portfolio managers/advisors and the investing public in achieving optimal asset and portfolio profile.

OIL REVENUE AND STATE BUDGET DYNAMIC RELATIONSHIP: EVIDENCE FROM BAHRAIN

The main purpose of the study is to investigate the short run and long run relationship between government revenues and government expenditures in Bahrain over the period from 1990 to 2017. Using annual data and time series analysis, the study indicated that the above two variables, government revenues and government expenditures were integrated of order one when both Augmented Dickey-Fuller (ADF) and Phillip-Perron (PP) unit root tests were applied. The empirical results have revealed that unidirectional causality runs from government revenues to government expenditures. Thus, there is evidence in support of “revenue-spend” hypothesis. Finally, the results revealed that a 1% increase in oil revenue induces an increase in government expenditures by 1.37%. Therefore, policymakers in Bahrain should focus to further diversify the sources of government revenues from non-oil sectors in such a way that the country will be immune to vulnerability, especially when world oil market performs poorly.Keywords: Oil revenues, Cointegration, Government expenditures, Government revenues, Granger causality, Bahrain.JEL Classifications: E62, H20, H30, C30, C40, C51DOI: https://doi.org/10.32479/ijeep.6991

Analysis of Management Collusive Decisions on the World Oil Market

The article examines the issue of the advantage and key conditions of collusion between the major oil exporting countries on the world oil market. This issue is explored in the paper within the framework of the concepts of stochastic cooperative game theory and the theory of industrial organisation. Namely, the concepts of game theory correspond to the conflicting interests of collusion participants. Next, the possibility of collusion between market players is considered and resolved using the theory of cooperative games. Stochastic methods of constructing and investigating the characteristic function of a cooperative game help to take into account the high volatility of the oil market. Further, the Cournot model of the theory of industrial organisation describes the strategic management of production volumes to maximize profits. The Stackelberg model takes into account the incentives to collude through the emergence of an industry leader, who first announces his management strategies. Based on these methodologies, the paper concludes that the collusion for its participants is beneficial, and the equilibrium levels of quotas for oil extraction are found.

A dynamic network analysis of the world oil market: Analysis of OPEC and non-OPEC members

We characterize the dynamic network structure of major oil producing countries. We examine the oil production coordination of 13 Organization of the Petroleum Exporting Countries (OPEC) and 17 non-OPEC members. We construct the dynamic network structure using the network connectedness measure of Diebold and Yilmaz (2009). We investigate the structural changes in connectedness of OPEC and non-OPEC members. Additionally, we study how the influence of OPEC members, non-OPEC countries and major oil producers evolve. We find that the network structure of major oil-producing countries changes significantly over time. Specifically, the impact of changes in oil-production of all OPEC members on global oil production declines, whereas the impact of non-OPEC on global oil production increases. OPEC's “increase” decisions have a significant and positive impact on OPEC and non-OPEC coordination. However, “cut” decisions do not affect coordination. We find that OPEC countries and developing countries have significantly higher levels of connectedness. Additionally, countries with high oil production levels have significantly more influence. The empirical results provide intuition about the recent developments in global oil production.

Distinguishable Patterns of Competition, Collusion, and Parallel Action

Alternative market structures are distinguishable by the degree of parallel action exhibited by producers. We show that the correlation between output levels varies systematically with the degree of interdependence among firms, and establish an ordering among alternative behavioral hypotheses (Cournot, Stackelberg, Edgeworth/Bertrand, collusion, and perfect competition). Because the ordering is invariant to the values of background parameters, statistical tests of market conduct may be possible even when the slopes of the demand curve and marginal cost curves are unknown. An application to the world oil market finds strong evidence of collusive behavior among OPEC members, but not elsewhere. (JEL: D43, L11, L13, Q41)

Oil import tariff game for energy security: The case of China and India

This paper investigates the optimal quota/tariff polices for China and India, two of the biggest developing countries who are facing the threat of possible oil supply disruptions, with taking into their possible interactions in the common world oil market. Our results indicate that the smaller (oil-importing) country may have higher incentive to free ride on the quota/tariff policy of the larger country. Besides, the optimal tariffs for the two countries would be larger in the cooperative case than those in the non-cooperative case. Moreover, the benefits of cooperation would be larger with a ‘disrupted’ market state than that with a ‘normal’ market state, which is reflective of the fact that it is more necessary and important to cooperate when the market state is worse.

Oil Price Basic Supply & Demand and Future Need

Crude oil price was collapsed since second half 2014, in oversupply world oil market; Among continuously evolved energy industry, and new industry ecologies characterized low carbon, the view that oil industry would be ruined, was arisen. With Brent oil price data on Augusts in 2017, global oil price motion was a Random Walk. The supply & demand of oil in global economic & social development was analyzed. The views that the difficult period of oil & gas industry was over, the future market of oil & gas was sufficient, the future demand of oil & gas was not ended up, was showed.

Тренды развития биржевой торговли на мировом рынке нефти. Перспективы российского экспортного сорта Urals в качестве мирового бенчмарка

Тренды развития биржевой торговли на мировом рынке нефти. Перспективы российского экспортного сорта Urals в качестве мирового бенчмарка