Costs of oil impacts and equilibrium of oil price

285 views

Published on

Risk ifluence and decision taken during crises on oil price-cost redution strategy with new energy supply exploration or getting to war for energy security

0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
285
On SlideShare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
2
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Costs of oil impacts and equilibrium of oil price

  1. 1. OIL CRISIS MANAGEMENT (cost transfers) 2 graphical simulations of crises impacting on the Oil price and amplification mechanisms leading to a return to the stability of the energy supplies and fixed price IRAK-IRAN WAR ARAB REVOLUTION BUSINESS INNOVATION RESEARCH DEVELOPMENT   
  2. 2. Iran­Irak war and oil crisis management No high Price = No costs COST TRANSFER ANALYSIS ENVIRON Koweit maintained Oil Volume Koweit MENTAL Production to avoid costs → IRAN invasion DAMAGES Costs were inevitable when Cost Irak envaheded Koweit and WHEN OIL burned of the volumes of oil FIELDS instead of redcuigng the Costs of BURNED production s required by Irak No duc pr war o rm tio EQUILIBRIUM US Solution al n (1990) Invasion IRAK Irak KOWEIT USA Invasion of Irak endebted of Irak is n Price of ris ctio C u oil is low US Solutions (2012) d pro + Energy Act S D + Strategy of diversification Cost = loss High S >> D Price oil Pressure toIrak increase the Production USA Oil dependenciesRequirements Volume On Koweit foreign import oil priceGS RADJOU unchanged     (Source: judgement call)
  3. 3. Arab revolutions and Oil crisis management:  Geo- Political risk costs World commodity/oil Low Prices ArabΔP<0 (2011) Oil Relative(Volume) revolution demand + …... ----> 2011, + 3%) + Syria ΔP>0 Oil high + Iran (Volume) price cost cost ΔP < 0 Oil Relative (Volume) demand Normal --> 2010, Volume of Oil low +1% Production price Cost=loss S Equilibrium D World (OPEC, China, Russia, USA,....) Hydrocarbon Exploration (Oil, Gas,...) S=D No cost = No need gas exploration Cost tranfers: Oil high price => costs because not able to produce and S<D the relative increase of demand (S< D) leads to cost for world gas GS RADJOU     exploration (Source :Surgutneftegas”)
  4. 4. CONTACT CONCERNING THESE SLIDES (Still work in progress) For a suggestion or a comments, Please, send a feed-back at: Georges RADJOU, CEO, MBA, DUPEBH georges_radjou_wb@hotmail.com   

×