Oil supply shocks and international policy coordination

Hubbard, R. Glenn; Weiner, Robert J.

doi:10.1016/0014-2921(86)90033-4

Cited by 10 publications

(7 citation statements)

References 14 publications

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“…Warnings of dire consequences due to increasing "rigidities" since then (49) have a curious Chicken Little aspect to them; since an analytical framework is lacking, it is unclear even what would constitute supporting evidence. Unfortunately, although the effects of buffer stock policy are sensitive to assumptions about the ease of reshuffling trade patterns, we are just beginning to model the case intermediate between the "no transaction cost" and "infinite transaction cost" poles (50).…”

Section: Modelin# the Worm Oil Marketmentioning

confidence: 99%

Managing the Strategic Petroleum Reserve: Energy Policy in a Market Setting

Hubbard¹,

Weiner²

1985

Annu. Rev. Energy.

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Ten years ago the US Congress authorized the creation of the Strategic Petroleum Reserve (SPR) with the intent of bolstering energy security. Today the Reserve stands at over 450 million barrels of oil-a large and potentially powerful policy instrument. The questions surrounding the Reserve, however, are many, complex, and largely unresolved. This paper examines these questions, in the process reviewing the analytical approaches to resolving them. The Problems of Oil Supply Disruptions Supply shocks are a recurrent feature of the modern, petroleum-fueled economy. Six times since World War II the world has witnessed disruptions in the flow of crude oil from the Middle East. In 1953, 1957, and 1967, taking advantage of excess production capacity, governments and oil companies cooperated to patch the system together (1, 2).

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Section: Modelin# the Worm Oil Marketmentioning

confidence: 99%

Managing the Strategic Petroleum Reserve: Energy Policy in a Market Setting

Hubbard¹,

Weiner²

1985

Annu. Rev. Energy.

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“…Equation These developments have important policy implications. Hubbard and Weiner (1984) have shown that the optimal public strategic stockpile responses to commodity price shocks depend on the persistence effects of price changes (4' in equation (31)). Since persistence is an increasing function/Of the relative importance of contracting, the optima!…”

Section: Extensions and Conclusionmentioning

confidence: 99%

“…"For a more general intertemporal optimizing model of inventory behavior under uncertainty, see Hubbard and Weiner (1984).…”

Section: Footnotesmentioning

confidence: 99%

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Nominal Contracting and Price Flexibility in Product Markets

Hubbard

Weiner

1985

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Nominal Contracting and Price Flexibility in Product Narkets ABSTRACrThe search for microeconomic foundations of rion-Wairasian outcomes In labor and product markets has spawned many studies of contracting. This paper emphasizes the role of contracts for market equilibrium--for many raw materials and basic industrial commodities--In which long-term contractual arrangements and spot markets coexist. Our principal goals are two--(I) to explain the existence of contracts and the equilibrium fraction of trades carried out under contract, and (ii) to consider the impact of demand and supply shocks on spot prices when market trades also take place through long-term contracts.We find that the relative importance of contracting depends on, inter alla, the variance of the spot price and the sources of underlying fluctuations. Consistent with the findings of previous macroeconomic studies, we find that contracting and price rigidity are more likely the more important demand shocks are relative to supply shocks. We adapt our static model of contract price and quantity determination to discuss the adjustment of contract prices. Finally, we discuss three important applications of our multiple-price modeling structure--to (I) analyses of the effects of changes in vertical market structure on market equilibrium in commodity markets (with specific reference to petroleum and copper), (ii) models of the optimal degree of contract indexation, and (iii) aggregate studies of "sticky prices" In macroeconomics.

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“…Hubbard and Weiner investigated the spillover effects of one *Address correspondence to this author at the Centre for Environmental and Climate Research (CEC), Lund University, Lund S-22362, Sweden; Tel: +46 46 2228633; E-mail: cascong@126.com country with strategic oil reserve on other countries [6]. Devarajan and Weiner discussed how to release the strategic reserves in the disruption of oil when the behavior of one country can have some impact on the world oil price [7].…”

Section: Introductionmentioning

confidence: 99%

Is There an Optimal Strategic Oil Reserve for Each Country? A Study Based on the Game Theory

Yang

Cong²

2014

TOEFJ

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Abstract:In generally, there is a phenomenon of "free rider" in the establishment of national oil reserves for different countries, which means that they have the tendency of underestimating the strategic oil reserves. This paper attempts to explain this phenomenon from the perspective of non-cooperative game theory. It also analyzes the establishment of strategic oil reserve among different countries based on the coalition game theory and presents the core solution for it. The results show that based on a certain constraint mechanism, it is feasible for different countries to establish their own suitable strategic oil reserves in theory and practice.

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Oil supply shocks and international policy coordination

Cited by 10 publications

References 14 publications

Managing the Strategic Petroleum Reserve: Energy Policy in a Market Setting

Managing the Strategic Petroleum Reserve: Energy Policy in a Market Setting

Nominal Contracting and Price Flexibility in Product Markets

Is There an Optimal Strategic Oil Reserve for Each Country? A Study Based on the Game Theory

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