Facebook LinkedIn Instagram Twitter
Shop
Search
Begin New Search
Proceed to Checkout

Search Results for All:
(Showing results 1 to 3 of 3)





OPEC's Incentives for Faster Output Growth

Dermot Gately

Year: 2004
Volume: Volume 25
Number: Number 2
DOI: 10.5547/ISSN0195-6574-EJ-Vol25-No2-4
View Abstract

Abstract:
This paper addresses the question of whether OPEC producers are likely to expand their oil output substantially over the next two decades more than doubling in the Gulf countries by 2020. Such projections, made by the International Energy Agency (IEA) and the U.S. Department of Energy (DOE), are not based on behavioral analysis of Gulf countries decisions, but are merely the residual demand for OPEC oil the difference between projected world oil demand and Non-OPEC supply, given some assumed price-path. I employ a simulation model to compare OPEC s payoffs from faster or slower output growth, under various parametric assumptions about the responsiveness of world oil demand and Non-OPEC supply to income and price changes. The payoffs to OPEC are relatively insensitive to faster output growth; aggressive output expansion yields slightly lower payoffs than just maintaining current market share. Analysis of intra-OPEC decisions between the Core countries and the others suggests a similar conclusion: these two groups are engaged in a constant-sum game. Thus, the significant increases in OPEC output projected by IEA and DOE are implausible.



What Oil Export Levels Should We Expect From OPEC?

Dermot Gately

Year: 2007
Volume: Volume 28
Number: Number 2
DOI: 10.5547/ISSN0195-6574-EJ-Vol28-No2-7
View Abstract

Abstract:
We analyze the levels of oil exports that should be expected from OPEC over the next 25 years. We search for a long-term, market-adaptive, robustly optimal strategy that best serves OPEC's interests, and conclude that OPEC export profits will be higher if OPEC expands its oil exports by enough to maintain OPEC exports share of non-OPEC demand. Yet the incentives for this export expansion are relatively small only a few percent in terms of discounted export profits and it requires that OPEC be farsighted, because the higher export profits from faster export growth wonot be significant within the next decade. Moreover, if OPEC does maintain its exports share of non-OPEC demand, the continued rapid growth of OPEC's own oil consumption will require that OPEC oil output will have to increase 60% by 2030, which will be a major challenge.





Begin New Search
Proceed to Checkout

 





function toggleAbstract(id) { alert(id); }