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The economic effects of tensions in energy transportation

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  • Morão, Hugo

Abstract

This paper tackles the urgent issue of how tensions in energy transportation impact oil markets and the global economy. The study introduces an energy transportation uncertainty index, developed from over 50 global newspapers, to monitor fluctuations in uncertainty associated with significant events such as the Tanker War, major US sanctions, the Exxon Valdez oil spill, the Nord Stream sabotage, the Colonial pipeline cyberattack, and various Gulf incidents. Using a structural vector autoregression (SVAR) model, the analysis shows that these fluctuations in transportation uncertainty cause increases in real oil prices due to supply chain challenges. While oil production dips initially due to perceived risks, it quickly rebounds, though inventories are heavily used. These shocks also heighten geopolitical tensions and reduce global industrial output.

Suggested Citation

  • Morão, Hugo, 2025. "The economic effects of tensions in energy transportation," Research in Transportation Economics, Elsevier, vol. 112(C).
    • Handle: RePEc:eee:retrec:v:112:y:2025:i:c:s0739885925000812
    DOI: 10.1016/j.retrec.2025.101598
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    1. Ufuk Can & Oguzhan Cepni & Rangan Gupta & Onur Polat, 2026. "From Supply-Chain Disruptions to Speculative Exuberance: How Energy Transportation Uncertainty Drives Oil Price Bubbles," Working Papers 202608, University of Pretoria, Department of Economics.

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    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • F51 - International Economics - - International Relations, National Security, and International Political Economy - - - International Conflicts; Negotiations; Sanctions
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • N70 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - General, International, or Comparative
    • L95 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Gas Utilities; Pipelines; Water Utilities

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