Buyer and Seller Concentration in Global Commodity Markets

Oladi, Reza; Gilbert, John

doi:10.1111/j.1467-9361.2012.00667.x

Cited by 8 publications

(5 citation statements)

References 18 publications

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“…For example, the oil-indexed LTCs, which failed to promptly adjust their positions, caused huge losses for European, and European importers requested to renegotiate for LTCs, gas suppliers such as Statoil, GasTerra, Sonatrach, and Gazprom were forced to modify their LTC prices and volumes in Europe (Allevi et al, 2019). Rajaraman (2009), Oladi andGilbert (2012), andRaff (2009) were the first to explore the issue of buyer power in an international trade context, but they did not apply it to the natural gas market. Zwart (2014) applied Frontiers in Earth Science frontiersin.org strategic trade theory to the natural gas market in a cooperative game framework, but their focus is on an environment where both buyers and sellers have market power.…”

Section: Frontiers In Earth Sciencementioning

confidence: 99%

Value of long-term LNG contracts: A theoretical and empirical study

Xia

Wu²,

Liu³

et al. 2023

Front. Earth Sci.

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With the rapid development of short-term and spot trade of liquefied natural gas (LNG), the natural gas market is gradually evolving from regionalization to globalization. At the same time, the existence and rationality of long-term LNG contracts have become increasingly controversial. To explore the value of long-term LNG contracts in the process of natural gas market globalization, this article constructs a two-stage game model and applies China’s LNG trade data in 2018 to the model. The study shows that, compared with complete import of short-term LNG, even if the long-term LNG contracts do not have price advantages, importing an appropriate amount of long-term LNG may help to increase the total LNG imports, reduce the price of LNG, and thus improve import benefits. Besides, a moderate amount of long-term LNG contracts is conducive to the establishment of a stable and flexible natural gas supply system and the security of natural gas imports. Therefore, natural gas importers should not underestimate or even ignore the value of long-term LNG contracts while actively participating in short-term and spot trade of natural gas.

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Section: Frontiers In Earth Sciencementioning

confidence: 99%

Value of long-term LNG contracts: A theoretical and empirical study

Xia

Wu²,

Liu³

et al. 2023

Front. Earth Sci.

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“…A second reason is that developing economies may have an economic structure that is quite different from developed economies, and indeed they are often characterized in the literature by numerous distortions (for recent contributions, see Chaudhuri and Yabuuchi, ; Marjit et al, ; Nakamura, ; Oladi and Gilbert, ; Pi and Zhou, ). Conclusions derived from models of IIT that do not factor these characteristics into account may be seriously misleading when applied to the developing world, or may fail to address issues of importance to developing economies.…”

Section: Introductionmentioning

confidence: 99%

North–South Trade Liberalization and Economic Welfare

Gilbert

Beladi

Oladi

2015

Review Development Economics

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We consider a general equilibrium model of a developing economy (the South) that opens to trade with a developed economy (the North). The southern economy is characterized by open urban unemployment and rural-urban migration, a competitive agricultural sector and a monopolistically competitive manufacturing sector. Hence, there is potential for both inter-and intra-industry trade to arise on liberalization, in addition to distortionary effects of duality. Southern comparative advantage in agriculture may arise from the labor market distortion and the basis for intra-industry trade is love for variety. We characterize various configurations of the trade pattern, and the resulting welfare consequences of opening to trade in this context. We illustrate a new mechanism under which in some circumstances it may be possible for trade liberalization to lower economic welfare in the South.

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“…So far, the effects of domestic trade policies on the extent of buyer power remain underexplored. Among the first to address the issue of buyer power in an international trade context were Deardorff and Rajaraman (), Oladi and Gilbert () and Raff and Schmitt (). The first of these studies analyzes optimal export subsidies when domestic competitive exporters face a foreign monopsony.…”

Section: Introductionmentioning

confidence: 99%

Trade Quotas and Buyer Power, With an Application to the E.U. Natural Gas Market

Ikonnikova

Zwart

2014

Journal of the European Economic Association

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We consider a market in which domestic buyers negotiate contracts with foreign sellers, and explore how trade quotas can help to increase the buyers' countervailing power. We use the Shapley value to describe bargaining power and the distribution of the trade surplus in such a bilateral oligopoly. By exploiting strategic externalities among the buyers, bilateral trade quotas can improve the buyers' bargaining positions. In contrast, aggregate trade restrictions on all buyers' trade never improve buyer surplus. Minimum quotas on imports from fringe suppliers can benefit nonaffected buyers, as these enjoy positive externalities. We apply these insights to the E.U. market for natural gas and show that the effects of trade quotas on E.U. gas importers' power can be significant.

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Buyer and Seller Concentration in Global Commodity Markets

Cited by 8 publications

References 18 publications

Value of long-term LNG contracts: A theoretical and empirical study

Value of long-term LNG contracts: A theoretical and empirical study

North–South Trade Liberalization and Economic Welfare

Trade Quotas and Buyer Power, With an Application to the E.U. Natural Gas Market

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