Search Results (48)

Indonesia’s dependence on fossil fuel exports, particularly coal and crude oil, presents a dual challenge: sustaining economic growth while addressing rising CO₂ emissions. Despite significant attention to domestic energy consumption, the environmental implications of export activities remain underexplored. This study examines the dynamic relationship between energy exports, crude oil prices, and CO₂ emissions in Indonesia using a Vector Autoregressive (VAR) model with annual data from 2002 to 2022. The analysis incorporates Impulse Response Functions (IRFs) and Forecast Error Variance Decomposition (FEVD) to trace short- and long-term interactions among variables. Findings reveal that coal exports are strongly persistent and positively linked to past emission levels, while oil exports respond negatively to both coal and emission shocks—suggesting internal trade-offs. CO₂ emissions are primarily self-driven yet increasingly influenced by oil export fluctuations over time. Crude oil prices, in contrast, have limited impact on domestic emissions. This study contributes a novel export-based perspective to Indonesia’s emission profile and demonstrates the value of dynamic modeling in policy analysis. Results underscore the importance of integrated strategies that balance trade objectives with climate commitments, offering evidence-based insights for refining Indonesia’s nationally determined contributions (NDCs) and sustainable energy policies. Full article

Rising population, combined with declining home food production, in Arab nations has resulted in increased food imports that intensifies their dependence on international markets for vital food supplies. These nations face challenges in achieving food security because crude oil price volatility creates difficulties in managing the expenses of imported food products. This research calculates the income and price elasticities of imported food demand to understand consumer behavior changes in response to income and price variations, which helps to explain their impact on regional food security. To our knowledge, this research presents the first analysis of imported food consumption patterns across Arab countries according to their income brackets. This study employs the static Almost Ideal Demand System model to examine food import data spanning from 1961 to 2020. The majority of imported food categories demonstrate inelastic price and income demand, which means that their essential food consumption remains stable despite cost fluctuations. The need for imports makes Arab nations vulnerable to external price changes, which endangers their food security. This research demonstrates why governments must implement policies through subsidies and taxation to reduce price volatility risks while ensuring food stability, which will lead to sustained food security for these nations. Full article

High-frequency fluctuations in the international crude oil market have led to multilevel characteristics in China’s domestic refined oil pricing mechanism. To address the poor fitting performance of single deep learning models on oil price data, which hampers accurate gasoline price prediction, this paper proposes a gasoline price prediction method based on a combined xLSTM–XGBoost model. Using gasoline price data from June 2000 to November 2024 in Sichuan Province as a sample, the data are decomposed via STL decomposition to extract trend, residual, and seasonal components. The xLSTM model is then employed to predict the trend and seasonal components, while XGBoost predicts the residual component. Finally, the predictions from both models are combined to produce the final forecast. The experimental results demonstrate that the proposed xLSTM–XGBoost model reduces the MAE by 14.8% compared to the second-best sLSTM–XGBoost model and by 83% compared to the traditional LSTM model, significantly enhancing prediction accuracy. Full article

Using the OLS model with different quantiles of GPR, we aim to examine the impact of GPR, EPU, and VIX on monthly international crude oil prices, including WTI, BRENT, and DUBAI prices, while differentiating the impact on different levels of risks. Afterwards, we use the GARCH and MGARCH models to assess the impact of these metrics on the volatility of oil prices, and the spillover effects between oil prices with these three metrics as exogenous shocks. Our result indicates (i) global oil price is negatively affected by GPRT at a moderate level of risks in longer time intervals; (ii) GPR, EPU, and VIX affect oil price’s volatility, and (iii) there exists a stronger long-persistent spillover effect between BRENT and DUBAI, with these metrics as exogenous shocks, while WTI is not affected. Full article

This study analyzes the crude oil supply in 2030 and 2050, comparing it with demand scenarios from the UN Intergovernmental Panel on Climate Change and the International Energy Agency. It focuses on the oil under production or development as of today (or the supply already under contract), and the oil frontiers. For that, it firstly evaluates a database of over 107,000 assets to identify and classify recoverable oil volumes through 2050. By comparing the supply and demand, this study identifies scenarios requiring production declines or, in opposition, the development of new projects and exploratory frontiers. The focus is on 2030 and 2050, which are key milestones in the global climate agenda. As an original contribution, the analysis also identifies how oil supply regions position themselves regarding oil quality, production costs, and the GHG emission intensity of the oil offered. As the second contribution, this study develops the probability assessment of recoverable resources to evaluate a typical oil frontier, analyzing how global climate scenarios could affect the probability of approving a deepwater offshore project. The findings show that cumulative oil consumption by 2050 may range from 600 billion to 1 trillion barrels, with marginal supply costs between US$28/bbl and US$44/bbl. The findings indicate that the frontier project lacks economic attractiveness in scenarios limiting the increase in the global surface temperature (GST) below 1.5 °C with no or limited overshoots. However, assuming a smooth price decline trajectory from today to 2050, the project exhibits high profitability and returns across all the scenarios. This suggests that the industry might remain inclined to approve new projects, even amid potential energy transition scenarios, driven by favorable short- and medium-term returns despite long-term uncertainties. Full article

The increasing requirement for distillates, accompanied by higher quantities of heavy crude oil in world production, has positioned gas oil hydrocracking as one of the most significant processes in refineries. In the petrochemical industry, hydrocracking is an essential process that converts heavy hydrocarbons into lighter and more valuable products such as LPG (liquefied petroleum gas), diesel, kerosene, light naphtha, and heavy naphtha. This method uses hydrogen and a catalyst to break down the gas oil feedstock through hydrogenation and hydrocracking reactions. However, the gas oil hydrocracking process faces significant technical, economic, and financial obstacles that must be overcome to reveal its full potential. In this study, a computer-assisted technical–economic evaluation and an evaluation of the technical–economic resilience of the gas oil hydrocracking process at an industrial scale was carried out. Twelve technical–economic and three financial indicators were evaluated to identify this type of process’s current commercial status and to analyze possible economic performance parameter optimizations. The economic indicators listed include gross profit (GP), profitability after taxes (PAT), economic potential (EP), cumulative cash flow (CCF), payback period (PBP), depreciable payback period (DPBP), return on investment (ROI), internal rate of return (IRR), net present value (NPV), annual cost/revenues (ACR), break-even point (BEP), and on-stream efficiency at the BEP. On the other hand, the financial indicators proposed by the methodology are earnings before taxes (EBT), earnings before interest and taxes (EBIT), and earnings before interest, taxes, depreciation, and amortization (EBITDA). The technical–economic resilience of the process was also evaluated, considering the costs of raw materials, the market prices of the products, and processing capacity. The gas oil hydrocracking plant described, with a useful life of 20 years and a processing capacity of 1,937,247.91 tonnes per year, achieved a gross profit (GP) of USD 58.97 million and a return after tax (PAT) of USD 39.77 million for the first year, operating at maximum capacity. The results indicated that the process is attractive under a commercial approach, presenting a net present value (NPV) of USD 68.87 million at the end of the last year of operation and a cumulative cash flow (CCF) of less than one year⁻¹ (0.34 years⁻¹) for the first year at full processing capacity, which shows that in this process, variable costs have more weight on the economic indicators than fixed costs. Full article

In this study, we conducted an in-depth analysis of the dynamic cointegration relationship between international crude oil, natural gas, and coal price indices from 2009 to 2023, revealing the changes and differences in the cointegration relationship between these three prices during different periods. Utilizing statistical analysis and economic modeling, we found significant cointegration among these energy prices during the initial decade-long observation period, indicating their close interaction in the global energy market influenced by supply and demand fundamentals, macroeconomic conditions, and geopolitical landscapes. However, since 2020, this long-standing stable cointegration relationship has been severely disrupted due to the global spread of the COVID-19 pandemic and escalating geopolitical tensions, leading to a notable increase in volatility and uncertainty in the energy market. Further analysis highlights that, in recent years, with the strengthening of global climate governance and the advancement of the low-carbon transition trend, fossil fuel markets, particularly high-carbon-emitting crude oil and coal markets, have undergone significant adjustments. Meanwhile, the role of natural gas as a transitional clean energy source has become increasingly prominent. The findings of this study have significant implications for energy policy formulation, market risk management, and strategic planning in the energy industry, while providing directions for future research on resilience and adaptability in the transition process of energy systems. Full article

Using a diagonal BEKK model, this paper estimates a spillover effect from the international crude oil market to the Korean stock market. Empirical results suggest that shocks and volatility in Dubai oil prices are significantly transmitted into twenty portfolios of the Korean stock market. Also, it was found that these spillover effects dramatically rose during the year 2020, when the threat of COVID-19 was the most serious. More specifically, oil-oriented portfolios, such as the power and gas firms’ portfolio and chemical firms’ portfolio, had a greater spillover effect from the international crude oil market rather than other portfolios. Further, compared to larger-capitalization firm portfolios, small-capitalization firm portfolios had a relatively greater spillover effect. Several implications and important avenues for further research are identified. Full article

This study explores the impact of international relations on China’s energy security and supply/demand dynamics, specifically focusing on new energy sources and technological advancements. Given China’s status as the world’s largest energy consumer, achieving a balance between energy supply, demand, and sustainable development is crucial. This study quantifies the influence of international relations on the energy market, particularly the uncertainties arising from geopolitical events and international tensions that affect energy supply and prices. The research findings indicate that, in a long-term cointegrated relationship, a 1% change in the geo-political risk (GPR) index leads to a 0.229% change in China’s crude oil imports. Additionally, the impact of China’s GDP growth, carbon emissions, and sustainable energy consumption is −2.176, 0.723, and 0.167, respectively. This study also discusses the reasons behind the differential impact of crude oil prices on the United States and China. Recognizing the interplay between China’s energy security and international relations is vital for effective policy formulation. This study provides valuable insights for policymakers and stakeholders to ensure a sustainable and secure energy future. Full article

Crude oil price forecasting is an important research area in the international bulk commodity market. However, as risk factors diversify, price movements exhibit more complex nonlinear behavior. Hence, this study provides a comprehensive analysis of forecasting Brent crude oil prices by comparing various hybrid combinations of linear and nonlinear time series models. To this end, first, the logarithmic transformation is used to stabilize the variance of the crude oil prices time series; second, the original time series of log crude oil prices is decomposed into two new subseries, such as a long-run trend series and a stochastic series, using the Hodrick–Prescott filter; and third, two linear and two nonlinear time series models are considered to forecast the decomposed subseries. Finally, the forecast results for each subseries are combined to obtain the final day-ahead forecast result. The proposed modeling framework is applied to daily Brent spot prices from 1 January 2013 to 27 December 2022. Six different accuracy metrics, pictorial analysis, and a statistical test are performed to verify the proposed methodology’s performance. The experimental results (accuracy measures, pictorial analysis, and statistical test) show the efficiency and accuracy of the proposed hybrid forecasting methodology. Additionally, our forecasting results are comparatively better than the benchmark models. Finally, we believe that the proposed forecasting method can be used for other complex financial time data to obtain highly efficient and accurate forecasts. Full article

This study examines the response of the Consumer Price Index (CPI) in local currency to the COVID-19 pandemic using monthly data (March 2020–February 2022), comparatively for six European countries. We have introduced a model of multivariate adaptive regression that considers the quasi-periodic effects of pandemic waves in combination with the global effect of the economic shock to model the variation in the price of crude oil at international levels and to compare the induced effect of the pandemic restriction as well and the oil price variation on each country’s CPI. The model was tested for the case of six emergent countries and developed European countries. The findings show that: (i) pandemic restrictions are driving a sharp rise in the CPI, and consequently inflation, in most European countries except Greece and Spain, and (ii) the emergent economies are more affected by the oil price and pandemic restriction than the developed ones. Full article

The energy security of each country is one of the main factors of its proper functioning. Currently, in the era of problems related to energy security resulting from, among other things, the war in Ukraine, this topic is particularly important. This article presents issues related to Poland’s energy security, understood as the financial and economic stability of enterprises operating in the energy industry. This stability is considered in two aspects: macroeconomic, where the focus is mainly on the aspect of state intervention in market processes; and microeconomic, where factors determining the financial security of energy enterprises were identified, including internal and external factors affecting the functioning of these entities. In order to achieve the assumed research goals, the analysis of the indicated problems was based on non-reactive research, consisting in the assessment of the available information. It included studies of normative acts, official statistical data, industry reports and analyses, as well as data obtained in the form of a public information request. Two basic research methods were used in the work—dogmatic–legal and comparative analyses. The identification of factors affecting the security of companies in the sector was carried out on the basis of data on the entire energy sector in Poland for the years 2015–2021 on a semi-annual basis. Vector-autoregressive models were used for the analysis. As a result of the analyses, it was established that market failures and public safety are the premises justifying the public financing of enterprises in the electricity generation, transmission, distribution and trade sectors. At the same time, the conducted research showed that the level of financial security of energy enterprises in Poland was affected by the ratio of the value of goods and materials sold to net sales revenue, as well as the level of EBIT (earnings before deducting interest and taxes) margin, and among external factors, the level of GDP (gross domestic product), CPI (consumer price index) and Crude Oil were important. Full article

The outbreak of the COVID-19 disease has gravely shaken the world economy. The economies of many countries have come under severe strain; Nigeria’s petroleum industry has been particularly affected. This has threatened the countries’ budgets and other essential needs involved in citizens’ welfare. The government is taking drastic measures to combat this scourge, with few results. This study adopts a doctrinal legal research approach and considers both the primary and secondary sources of law, such as judicial precedents, international conventions, and peer-reviewed journals. Legal theories were also applied as an academic lens for modelling the research. The justification for using the method was to establish the trustworthiness of the findings on the impacts of crude oil price shock on Nigeria’s economy, its legal and policy options. This study investigates the influences of oil price shock on the country’s economy and the legal remedies required to build economic resilience to mitigate future contingencies. The study argues that the provisions of the extant laws can be utilised as a preventive mechanism for tackling the impacts of oil price shock on Nigeria’s economy. The study recommends other remedial measures, such as diversification from oil and gas to non-oil sectors. The study designed a hybrid model for mitigating the influences of crude oil prices on the country’s extractive wealth. The study advocates for the need for an effective legal regime to shield the domestic economy from international oil price instability. The implications of the main results are that crude oil production and prices play a significant role in real growth enhancement. However, they exert a negative but unsustainable standard innovation on growth, which could be mitigated through appropriate legal and policy options. Nigeria needs stringent, transparent, and the best petroleum management practice laws to manage its petroleum sector’s revenues for sustainability. Full article

Revealing the effect mechanism of carbon price drivers is the basis to establish the pricing mechanism of carbon emission exchange, which also promotes the development of the carbon emission exchange market and can reduce the investment risk. Based on the previous research, the cointegration test, Granger causality test, and ridge regression estimate are used to analyze the effect mechanism between the domestic carbon price and its drivers. Johansen’s cointegration analysis reveals that there is a long-term equilibrium relationship between the domestic carbon price and energy price, industrial development level, climate change, and financial prosperity. Ridge regression estimates reveal that the international spot price of thermal coal in the ARA port and the spot price of Brent crude oil in Britain are negatively correlated with the domestic carbon price, while CER futures price is positively correlated with the domestic carbon price. There is a linkage between the international carbon price and the domestic carbon price. Since 2017, the domestic carbon price has been lower than the equilibrium value, and the value of carbon emission rights has been underestimated. With the continuous improvement of the domestic carbon market, the carbon price will rise and fluctuate around the equilibrium price in the future. Full article

The Chinese refined oil pricing reform in 2013 has brought its refined oil price to be more aligned with the international oil price, helping to mitigate prior distorted pricing mechanisms. Its impact on the correlation, tail risks, and spillover effects between the international crude oil market and Chinese sectoral stock markets warrants empirical assessments. Time-varying copula models and conditional VaR (CoVaR) are employed to examine the correlation between the international oil market and Chinese sectoral stock indexes before and after the 2013 pricing reform, as well as the tail risk and spillover effects of the extreme and moderate oil markets. The results show that: (1) the correlation between the oil market and all 11 Chinese stock sectors is positive both before and after the reform, but the correlation is weaker after the reform than before; (2) The downside tail risk of the extreme and moderate oil markets to most Chinese stock market sectors, and the upside tail risk of the moderate oil market to most stock sectors are lower after the reform; (3) Tail risk spillover effects of extreme oil market on all sectors exist before and after the reform; (4) The upside tail risk spillover effects of moderate oil market exist in most sectors before the reform, but they almost all disappear after the reform. The downside risk spillover effects of the moderate oil market do not exist before or after the reform. The findings provide valuable references for portfolio management and future policy update. Full article