IDEAS home Printed from https://ideas.repec.org/a/eee/eneeco/v88y2020ics0140988320301031.html
   My bibliography  Save this article

The oil-slick trade: An analysis of embodied crude oil in China's trade and consumption

Author

Listed:
  • Zhang, Wencheng
  • Wei, Rui
  • Peng, Shuijun

Abstract

China has become the world's second largest crude oil importer and consumer. The international fragmentation of production has had an important impact on China's oil consumption, which cannot be assessed adequately through only checking China's trade data of crude oil. Based on a global multi-regional input–output model, we examine crude oil embodied in China's trade during 1995–2011. The results show that approximately one fifth to one third of imported oil in China is re-exported through producing commodities and services for satisfying final consumption outside China. We show that China is playing a role as a transit hub of crude oil from extraction locations to global consumers, particularly those in advanced countries. Foreign consumers actually benefit from China's global seeking of natural resources, a fact that is usually overlooked by critics of China's oil thirst. In addition, we show that China's oil import dependence assessed from the consumption side is greater than when assessed from the production side, shedding new light on the discussion of energy security in China.

Suggested Citation

  • Zhang, Wencheng & Wei, Rui & Peng, Shuijun, 2020. "The oil-slick trade: An analysis of embodied crude oil in China's trade and consumption," Energy Economics, Elsevier, vol. 88(C).
    • Handle: RePEc:eee:eneeco:v:88:y:2020:i:c:s0140988320301031
    DOI: 10.1016/j.eneco.2020.104763
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0140988320301031
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.eneco.2020.104763?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Peng, Shuijun & Zhang, Wencheng & Sun, Chuanwang, 2016. "‘Environmental load displacement’ from the North to the South: A consumption-based perspective with a focus on China," Ecological Economics, Elsevier, vol. 128(C), pages 147-158.
    2. Duan, Yuwan & Jiang, Xuemei, 2017. "Temporal Change of China's Pollution Terms of Trade and its Determinants," Ecological Economics, Elsevier, vol. 132(C), pages 31-44.
    3. Ge, Fenglong & Fan, Ying, 2013. "Quantifying the risk to crude oil imports in China: An improved portfolio approach," Energy Economics, Elsevier, vol. 40(C), pages 72-80.
    4. Munksgaard, Jesper & Pedersen, Klaus Alsted, 2001. "CO2 accounts for open economies: producer or consumer responsibility?," Energy Policy, Elsevier, vol. 29(4), pages 327-334, March.
    5. Wu, Gang & Wei, Yi-Ming & Fan, Ying & Liu, Lan-Cui, 2007. "An empirical analysis of the risk of crude oil imports in China using improved portfolio approach," Energy Policy, Elsevier, vol. 35(8), pages 4190-4199, August.
    6. Kirsten S. Wiebe & Martin Bruckner & Stefan Giljum & Christian Lutz & Christine Polzin, 2012. "Carbon and Materials Embodied in the International Trade of Emerging Economies," Journal of Industrial Ecology, Yale University, vol. 16(4), pages 636-646, August.
    7. Marcel P. Timmer & Erik Dietzenbacher & Bart Los & Robert Stehrer & Gaaitzen J. Vries, 2015. "An Illustrated User Guide to the World Input–Output Database: the Case of Global Automotive Production," Review of International Economics, Wiley Blackwell, vol. 23(3), pages 575-605, August.
    8. Arto, I. & Rueda-Cantuche, J.M. & Andreoni, V. & Mongelli, I. & Genty, A., 2014. "The game of trading jobs for emissions," Energy Policy, Elsevier, vol. 66(C), pages 517-525.
      • Arto, I. & Rueda-Cantuche, José M. & Dietzenbacher, E. & Andreoni, V. & Mongelli, I. & Genty, A. & Villanueva, A., 2012. "The Game of Trading Jobs for Emissions," Conference papers 332231, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    9. Leung, Guy C.K., 2011. "China's energy security: Perception and reality," Energy Policy, Elsevier, vol. 39(3), pages 1330-1337, March.
    10. Yang, Ranran & Long, Ruyin & Yue, Ting & Shi, Haihong, 2014. "Calculation of embodied energy in Sino-USA trade: 1997–2011," Energy Policy, Elsevier, vol. 72(C), pages 110-119.
    11. Chen, Z.M. & Chen, G.Q., 2011. "An overview of energy consumption of the globalized world economy," Energy Policy, Elsevier, vol. 39(10), pages 5920-5928, October.
    12. Jiang, Xuemei & Guan, Dabo & López, Luis Antonio, 2018. "The global CO2 emission cost of geographic shifts in international sourcing," Energy Economics, Elsevier, vol. 73(C), pages 122-134.
    13. Muñoz, Pablo & Steininger, Karl W., 2010. "Austria's CO2 responsibility and the carbon content of its international trade," Ecological Economics, Elsevier, vol. 69(10), pages 2003-2019, August.
    14. Zhang, Youguo, 2017. "Interregional carbon emission spillover–feedback effects in China," Energy Policy, Elsevier, vol. 100(C), pages 138-148.
    15. Cui, Lian-Biao & Peng, Pan & Zhu, Lei, 2015. "Embodied energy, export policy adjustment and China's sustainable development: A multi-regional input-output analysis," Energy, Elsevier, vol. 82(C), pages 457-467.
    16. Manfred Lenzen & Lise-Lotte Pade & Jesper Munksgaard, 2004. "CO2 Multipliers in Multi-region Input-Output Models," Economic Systems Research, Taylor & Francis Journals, vol. 16(4), pages 391-412.
    17. Liu, Hongtao & Xi, Youmin & Guo, Ju'e & Li, Xia, 2010. "Energy embodied in the international trade of China: An energy input-output analysis," Energy Policy, Elsevier, vol. 38(8), pages 3957-3964, August.
    18. Robbie Andrew & Glen Peters & James Lennox, 2009. "Approximation And Regional Aggregation In Multi-Regional Input-Output Analysis For National Carbon Footprint Accounting," Economic Systems Research, Taylor & Francis Journals, vol. 21(3), pages 311-335.
    19. Koopman, Robert & Wei, Shang-Jin & Wang, Zhi, 2009. "A World Factory in Global Production Chains: Estimating Imported Value Added in Chinese Exports," CEPR Discussion Papers 7430, C.E.P.R. Discussion Papers.
    20. Moran, Daniel D. & Lenzen, Manfred & Kanemoto, Keiichiro & Geschke, Arne, 2013. "Does ecologically unequal exchange occur?," Ecological Economics, Elsevier, vol. 89(C), pages 177-186.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Yousaf Raza, Muhammad & Lin, Boqiang, 2021. "Oil for Pakistan: What are the main factors affecting the oil import?," Energy, Elsevier, vol. 237(C).
    2. Rahat, Birjees & Nguyen, Pascal, 2022. "Risk-adjusted investment performance of green and black portfolios and impact of toxic divestments in emerging markets," Energy Economics, Elsevier, vol. 116(C).
    3. Liu, Haiping & Li, Huajiao & Qi, Yajie & An, Pengli & Shi, Jianglan & Liu, Yanxin, 2021. "Identification of high-risk agents and relationships in nickel, cobalt, and lithium trade based on resource-dependent networks," Resources Policy, Elsevier, vol. 74(C).
    4. Li, Jingyu & Liu, Ranran & Yao, Yanzhen & Xie, Qiwei, 2022. "Time-frequency volatility spillovers across the international crude oil market and Chinese major energy futures markets: Evidence from COVID-19," Resources Policy, Elsevier, vol. 77(C).
    5. Zhang, Ping & Zhuo, La & Li, Meng & Liu, Yilin & Wu, Pute, 2023. "Assessment of advanced bioethanol potential under water and land resource constraints in China," Renewable Energy, Elsevier, vol. 212(C), pages 359-371.
    6. Wu, Bo & Wang, Yan-Wei & Dai, Yong-Hua & Song, Chao & Zhu, Qi-Li & Qin, Han & Tan, Fu-Rong & Chen, Han-Cheng & Dai, Li-Chun & Hu, Guo-Quan & He, Ming-Xiong, 2021. "Current status and future prospective of bio-ethanol industry in China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 145(C).
    7. Lan, Yueqin & Krishnan, Deepika & Zheng, Jiyuan, 2023. "Impact of international trade on crude oil in political unstable economies: Evidence from quantile regression," Resources Policy, Elsevier, vol. 83(C).
    8. Xie, Qiwei & Liu, Ranran & Qian, Tao & Li, Jingyu, 2021. "Linkages between the international crude oil market and the Chinese stock market: A BEKK-GARCH-AFD approach," Energy Economics, Elsevier, vol. 102(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Peng, Shuijun & Zhang, Wencheng & Sun, Chuanwang, 2016. "‘Environmental load displacement’ from the North to the South: A consumption-based perspective with a focus on China," Ecological Economics, Elsevier, vol. 128(C), pages 147-158.
    2. Gabriela Michalek & Reimund Schwarze, 2015. "Carbon leakage: pollution, trade or politics?," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 17(6), pages 1471-1492, December.
    3. Sun, Xiaoqi & An, Haizhong & Gao, Xiangyun & Jia, Xiaoliang & Liu, Xiaojia, 2016. "Indirect energy flow between industrial sectors in China: A complex network approach," Energy, Elsevier, vol. 94(C), pages 195-205.
    4. Zhang, Zhonghua & Zhao, Yuhuan & Su, Bin & Zhang, Yongfeng & Wang, Song & Liu, Ya & Li, Hao, 2017. "Embodied carbon in China’s foreign trade: An online SCI-E and SSCI based literature review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 68(P1), pages 492-510.
    5. Piñero, Pablo & Heikkinen, Mari & Mäenpää, Ilmo & Pongrácz, Eva, 2015. "Sector aggregation bias in environmentally extended input output modeling of raw material flows in Finland," Ecological Economics, Elsevier, vol. 119(C), pages 217-229.
    6. Karl Steininger & Pablo Munoz & Jonas Karstensen & Glen Peters & Rita Strohmaier & Erick Velazquez, 2017. "Austria’s Consumption-Based Greenhouse Gas Emissions: Identifying sectoral sources and destinations," EcoMod2017 10472, EcoMod.
    7. Zhong, Zhangqi & Jiang, Lei & Zhou, Peng, 2018. "Transnational transfer of carbon emissions embodied in trade: Characteristics and determinants from a spatial perspective," Energy, Elsevier, vol. 147(C), pages 858-875.
    8. Duan, Yuwan & Yan, Bingqian, 2019. "Economic gains and environmental losses from international trade: A decomposition of pollution intensity in China's value-added trade," Energy Economics, Elsevier, vol. 83(C), pages 540-554.
    9. Zhang, Bo & Qu, Xue & Meng, Jing & Sun, Xudong, 2017. "Identifying primary energy requirements in structural path analysis: A case study of China 2012," Applied Energy, Elsevier, vol. 191(C), pages 425-435.
    10. Hermannsson, Kristinn & McIntyre, Stuart G., 2014. "Local consumption and territorial based accounting for CO2 emissions," Ecological Economics, Elsevier, vol. 104(C), pages 1-11.
    11. Gasim, Anwar A., 2015. "The embodied energy in trade: What role does specialization play?," Energy Policy, Elsevier, vol. 86(C), pages 186-197.
    12. Vinicius A. Vale & Fernando S. Perobelli & Ariaster B. Chimeli, 2018. "International trade, pollution, and economic structure: evidence on CO2 emissions for the North and the South," Economic Systems Research, Taylor & Francis Journals, vol. 30(1), pages 1-17, January.
    13. Wencheng Zhang & Shuijun Peng, 2016. "Analysis on CO 2 Emissions Transferred from Developed Economies to China through Trade," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 24(2), pages 68-89, March.
    14. Dolter, Brett & Victor, Peter A., 2016. "Casting a long shadow: Demand-based accounting of Canada's greenhouse gas emissions responsibility," Ecological Economics, Elsevier, vol. 127(C), pages 156-164.
    15. Wang, H. & Ang, B.W. & Su, Bin, 2017. "A Multi-region Structural Decomposition Analysis of Global CO2 Emission Intensity," Ecological Economics, Elsevier, vol. 142(C), pages 163-176.
    16. Qi, Tianyu & Winchester, Niven & Karplus, Valerie J. & Zhang, Xiliang, 2014. "Will economic restructuring in China reduce trade-embodied CO2 emissions?," Energy Economics, Elsevier, vol. 42(C), pages 204-212.
    17. Gavrilova, Olga & Vilu, Raivo, 2012. "Production-based and consumption-based national greenhouse gas inventories: An implication for Estonia," Ecological Economics, Elsevier, vol. 75(C), pages 161-173.
    18. Jinghui Liu & Tingting Geng & Xingwei Wang & Guojin Qin, 2020. "Determinants of Oil Footprints Embodied in Sino-US Trade: A Perspective from the Globalizing World," Energies, MDPI, vol. 13(15), pages 1-26, July.
    19. Cadarso, María-Ángeles & López, Luis-Antonio & Gómez, Nuria & Tobarra, María-Ángeles, 2012. "International trade and shared environmental responsibility by sector. An application to the Spanish economy," Ecological Economics, Elsevier, vol. 83(C), pages 221-235.
    20. Duan, Yuwan & Jiang, Xuemei, 2017. "Temporal Change of China's Pollution Terms of Trade and its Determinants," Ecological Economics, Elsevier, vol. 132(C), pages 31-44.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:eneeco:v:88:y:2020:i:c:s0140988320301031. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eneco .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.