Effects of International Crude Oil Prices on Energy Consumption in China
Abstract
:1. Introduction
2. Literature Review
3. Methodology
4. Data
- ENERGY: Total energy consumption
- COAL: Coal consumption
- OIL: Crude oil consumption
- HYDRO: Hydropower consumption
- GAS: Natural gas consumption
- PRICE: Real crude oil price
5. Empirical Results
5.1. Break Dates
5.2. Unit Root
5.3. Cointegration Analysis
5.3.1. Engle–Granger Test
5.3.2. Johansen Tests
5.4. Weak Exogeneity Tests
5.5. ECM Estimation and Granger Causality Test
6. Discussions
7. Conclusions
Author Contributions
Funding
Conflicts of Interest
References
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Statistic | Total Energy Consumption (Mtoe) | Coal Consumption (Mtoe) | Crude Oil Consumption (million tonnes) | Natural Gas Consumption (Mtoe) | Hydropower Consumption (Mtoe) | Real Crude Oil Price |
---|---|---|---|---|---|---|
Variable | ENERGY | COAL | OIL | GAS | HYDRO | PRICE |
Mean | 1039.27 | 739.98 | 191.12 | 36.33 | 58.98 | 50.78 |
Median | 700.62 | 540.32 | 117.87 | 14.47 | 28.45 | 41.65 |
Maximum | 3052.98 | 1969.07 | 578.66 | 189.31 | 263.11 | 118.71 |
Minimum | 128.44 | 107.99 | 10.96 | 1.02 | 4.39 | 11.12 |
Std. Dev. | 906.64 | 608.38 | 162.93 | 49.59 | 70.05 | 31.82 |
Skewness | 1.06 | 0.94 | 0.97 | 1.90 | 1.59 | 0.67 |
Kurtosis | 2.77 | 2.47 | 2.74 | 5.40 | 4.48 | 2.34 |
Jarque-Bera | 9.80 | 8.32 | 8.35 | 43.78 | 26.78 | 4.88 |
Probability | 0.01 | 0.02 | 0.02 | 0.00 | 0.00 | 0.09 |
Variable | k | Parameter | Estimate | Standard Error | p-Value | Tb | |
---|---|---|---|---|---|---|---|
ENERGY | 8 | θ | 0.04 | 0.05 | 0.92 | 0.36 | |
β | 0.02 | 0.01 | 2.71 | 0.01 | |||
γ | 0.00 | 0.00 | −1.35 | 0.19 | |||
δ | 0.04 | 0.05 | 0.86 | 0.39 | |||
α | 0.76 | 0.07 | 10.69 | 0.00 | 1981 | ||
COAL | 5 | θ | −0.07 | 0.09 | −0.82 | 0.42 | |
β | 0.02 | 0.01 | 3.06 | 0.00 | |||
γ | 0.00 | 0.00 | 0.27 | 0.79 | |||
δ | 0.04 | 0.04 | 0.86 | 0.39 | |||
α | 0.67 | 0.11 | 6.19 | 0.00 | |||
OIL | 8 | θ | 0.07 | 0.15 | 0.45 | 0.65 | |
β | 0.05 | 0.01 | 4.58 | 0.00 | |||
γ | −0.01 | 0.01 | −1.04 | 0.31 | |||
δ | 0.07 | 0.04 | 1.71 | 0.10 | |||
α | 0.36 | 0.11 | 3.31 | 0.00 | |||
GAS | 7 | θ | −0.65 | 0.24 | −2.74 | 0.01 | |
β | 0.01 | 0.00 | 4.23 | 0.00 | |||
γ | 0.02 | 0.01 | 2.95 | 0.01 | |||
δ | −0.03 | 0.04 | −0.64 | 0.53 | |||
α | 0.76 | 0.06 | 13.69 | 0.00 | 2000 | ||
HYDRO | 5 | θ | −0.29 | 0.12 | −2.43 | 0.02 | |
β | 0.03 | 0.01 | 1.85 | 0.07 | |||
γ | 0.01 | 0.00 | 2.12 | 0.04 | |||
δ | −0.03 | 0.08 | −0.40 | 0.69 | |||
α | 0.66 | 0.17 | 3.87 | 0.00 | |||
PRICE | 8 | θ | −1.56 | 0.61 | −2.58 | 0.02 | |
β | 0.01 | 0.02 | 0.69 | 0.49 | |||
γ | 0.03 | 0.02 | 1.61 | 0.12 | |||
δ | 0.27 | 0.33 | 0.82 | 0.42 | |||
α | 0.05 | 0.21 | 0.22 | 0.83 |
Variable | k | Level | k | First Difference | k | Second Difference |
---|---|---|---|---|---|---|
ADF | ||||||
ENERGY | 4 | −2.64 | 9 | −3.98 ** | - | - |
COAL | 5 | −2.86 | 9 | −3.50 * | - | - |
OIL | 7 | −4.60 *** | 0 | - | - | - |
GAS | 7 | −3.05 | 7 | −2.90 | −10 | −2.26 |
HYDRO | 5 | −0.87 | 9 | −2.93 | −9 | −3.71 ** |
PRICE | 6 | −3.56 | 0 | −6.62 *** | - | - |
PP | ||||||
ENERGY | 1 | −2.09 | 10 | −3.31 * | - | - |
COAL | 0 | −1.61 | 9 | −3.53 ** | - | - |
OIL | 3 | −3.04 | 2 | −4.23 *** | - | - |
GAS | 5 | −1.95 | 1 | −3.07 | 4 | −8.04 *** |
HYDRO | 2 | −2.72 | 3 | −8.01 *** | - | - |
PRICE | 2 | −1.84 | 2 | −6.62 *** | - | - |
ERS DF-GLS | ||||||
ENERGY | 4 | −2.27 | 0 | −3.90 *** | - | - |
COAL | 1 | −3.39 | 1 | −5.16 *** | - | - |
OIL | 1 | −1.45 | 1 | −3.29 ** | - | - |
GAS | 1 | −1.83 | 2 | −2.00 | −6 | −1.82 |
HYDRO | 0 | −2.28 | 0 | −7.99 *** | - | - |
PRICE | 0 | −1.72 | 5 | −1.87 | 10 | −0.08 |
Dependent Variable | Zα-Statistic | p-Value |
---|---|---|
COAL | 15.35 | 1.00 |
OIL | 57.88 | 1.00 |
HYDRO | 43.68 | 1.00 |
PRICE | −29.75 | 0.02 |
Price Elasticity of Energy Consumption | k | 3 | 4 | 5 | 6 * | 7 | 8 |
---|---|---|---|---|---|---|---|
OIL | Long run | 0.21 | −0.62 | 0.63 | 0.46 | 0.60 | 0.65 |
- | Short run | −0.04 | 0.05 | −0.08 | −0.18 | Not significant | 0.77 |
COAL | Long run | 1.19 | −0.37 | −0.81 | −0.93 | −2.86 | −1.91 |
HYDRO | Long run | −0.60 | 0.15 | 0.22 | 0.24 | 0.28 | 0.27 |
Log-likelihood | - | 306.63 | 335.14 | 333.84 | 370.26 | 445.14 | 592.10 |
AIC | - | −9.38 | −10.18 | −10.47 | −11.61 | −13.50 | −19.73 |
SIC | - | −6.99 | −6.85 | −6.77 | −7.24 | −8.04 | −12.95 |
LM | - | 25.69 (0.06) | 19.52 (0.24) | 21.85 (0.15) | 9.45 (0.89) | 14.06 (0.59) | 22.46 (0.13) |
Multivariate normality | - | 3.41 (0.91) | 5.23 (0.73) | 2.86 (0.94) | 7.19 (0.52) | 6.40 (0.60) | 7.53 (0.48) |
R | k | Eigenvalue | Trace | O-L * | Cheung–Lai ** | Reinsel–Ahn *** |
---|---|---|---|---|---|---|
0 | 6 | 0.89 | 165.03 | 63.88 | 112.72 | 69.82 |
≤1 | - | 0.51 | 66.44 | 42.92 | 75.73 | 28.11 |
≤2 | - | 0.35 | 33.96 | 25.87 | 45.66 | 14.37 |
≤3 | - | 0.28 | 14.65 | 12.52 | 22.09 | 6.20 |
Variable | H0: α = 0 | Wald-χ2 | Degrees of Freedom | p-Value |
---|---|---|---|---|
COAL | α11 = 0 | 8.46 | 1 | 0.00 |
OIL | α21 = 0 | 9.51 | 1 | 0.00 |
HYDRO | α31 = 0 | 28.13 | 1 | 0.00 |
PRICE | α41 = 0 | 1.28 | 1 | 0.26 |
Dependent Variable | COAL | OIL | HYDRO | PRICE |
---|---|---|---|---|
Error correction | −0.218(−2.06) | 0.173(2.24) | 0.615(4.57) | 0.513(0.76) |
PRICE(-1) | 0.254(2.06) | −0.245(−2.73) | −0.594(−3.81) | −0.709(−0.91) |
PRICE(-2) | 0.207(1.76) | −0.171(−2.00) | −0.482(−3.24) | −0.724(−0.97) |
PRICE(-3) | 0.159(1.68) | −0.196(−2.84) | −0.342(−2.87) | −0.260(−0.43) |
PRICE(-4) | 0.167(2.42) | −0.072(−1.41) | −0.264(−3.01) | −0.292(−0.66) |
PRICE(-5) | 0.018(0.35) | −0.115(−3.11) | −0.043(−0.67) | 0.104(0.32) |
PRICE(-6) | 0.003(0.10) | −0.023(−1.02) | −0.014(−0.35) | 0.385(1.99) |
COAL(-1) | 0.791(3.42) | 0.273(1.61) | −0.107(−0.36) | 3.639(2.48) |
COAL(-2) | 0.105(0.35) | −0.227(−1.06) | 0.452(1.22) | −0.478(−0.25) |
COAL(-3) | −0.185(−0.70) | −0.119(−0.61) | −0.899(−2.70) | −2.350(−1.41) |
COAL(-4) | 0.207(0.63) | −0.399(−1.68) | −1.009(−2.45) | −1.152(−0.56) |
COAL(-5) | 0.655(2.18) | −0.445(−2.03) | −0.244(−0.64) | 1.612(0.85) |
COAL(-6) | −0.185(−0.98) | 0.055(0.40) | −0.189(−0.79) | 0.366(0.30) |
OIL(-1) | 0.322(1.26) | 0.427(2.28) | 0.000(0.00) | 1.137(0.70) |
OIL(-2) | −0.603(−2.21) | 0.156(0.78) | 1.192(3.45) | −2.343(−1.36) |
OIL(-3) | −0.370(−1.30) | 0.189(0.91) | 0.776(2.16) | 4.800(2.67) |
OIL(-4) | −0.368(−0.90) | 1.019(3.41) | 1.669(3.23) | 3.488(1.35) |
OIL(-5) | −1.020(−2.15) | 0.421(1.21) | 1.789(2.98) | 1.227(0.41) |
OIL(-6) | −0.219(−0.73) | 0.396(1.81) | 0.452(1.19) | −1.014(−0.54) |
HYDRO(-1) | −0.340(−1.08) | 0.506(2.20) | 1.366(3.43) | 0.748(0.37) |
HYDRO(-2) | −0.434(−1.73) | 0.526(2.87) | 1.187(3.73) | 0.773(0.48) |
HYDRO(-3) | −0.514(−2.00) | 0.591(3.15) | 0.926(2.85) | −0.353(−0.21) |
HYDRO(-4) | −0.357(−1.54) | 0.233(1.38) | 0.708(2.42) | 0.944(0.64) |
HYDRO(-5) | −0.132(−0.62) | 0.495(3.23) | 0.250(0.94) | −0.216(−0.16) |
HYDRO(-6) | −0.228(−1.64) | 0.004(0.03) | 0.366(2.08) | −0.718(−0.81) |
Constant | 0.279(1.94) | −0.242(−2.30) | −0.569(−3.13) | −0.649(−0.71) |
Adj. R2 | 0.38 | 0.72 | 0.62 | 0.44 |
F-statistic | 2.07 | 5.58 | 3.91 | 2.38 |
Log likelihood | 104.18 | 118.31 | 93.54 | 21.11 |
AIC | −3.48 | −4.10 | −3.00 | 0.22 |
SIC | −2.43 | −3.06 | −1.96 | 1.26 |
H0 | LR | Degrees of Freedom | p-Value | Wald χ2 | Degrees of Freedom | p-Value |
---|---|---|---|---|---|---|
PRICE to COAL | 24.17 | 6 | 0.00 *** | 13.51 | 6 | 0.04 ** |
PRICE to OIL | 31.01 | 6 | 0.00 *** | 18.84 | 6 | 0.00 *** |
PRICE to HYDRO | 43.08 | 6 | 0.00 *** | 30.48 | 6 | 0.00 *** |
COAL to PRICE | 19.67 | 6 | 0.00 *** | 10.42 | 6 | 0.11 |
OIL to PRICE | 26.23 | 6 | 0.00 *** | 15.03 | 6 | 0.02 ** |
HYDRO to PRICE | 11.73 | 6 | 0.07 | 5.66 | 6 | 0.46 |
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Zou, G.; Chau, K.W. Effects of International Crude Oil Prices on Energy Consumption in China. Energies 2020, 13, 3891. https://doi.org/10.3390/en13153891
Zou G, Chau KW. Effects of International Crude Oil Prices on Energy Consumption in China. Energies. 2020; 13(15):3891. https://doi.org/10.3390/en13153891
Chicago/Turabian StyleZou, Gaolu, and Kwong Wing Chau. 2020. "Effects of International Crude Oil Prices on Energy Consumption in China" Energies 13, no. 15: 3891. https://doi.org/10.3390/en13153891