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How political conflicts threaten energy security and economic growth in Asia: A study on the sanctions imposed on Iran

Author

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  • Wei Wei
  • Qi Cui
  • Heng Cui

Abstract

Given their high dependence on energy imports, Asian countries’ energy security is challenged by international political conflicts that interfere with the global energy supply. This study examines the impacts of the sanctions imposed on Iran on the energy security and economic growth of oil-importing Asian countries. A global computable equilibrium model is applied, and three illustrative scenarios are developed to simulate a full embargo on Iran's oil exports, the utilization of spare oil production capacity of other Persian Gulf countries, and a reduction of their oil exports. The impacts of a full embargo are not disastrous if oil exports from other Persian Gulf petrostates are secured. The utilization of spare oil production capacity could largely buffer the impacts on Asian countries’ oil prices than oil supply. Under a pessimistic scenario, the oil supply of Asian countries would be disastrously disturbed. Moreover, political conflicts would force Asian countries to struggle for oil import sources, straining their relations and causing intense international competition.

Suggested Citation

  • Wei Wei & Qi Cui & Heng Cui, 2023. "How political conflicts threaten energy security and economic growth in Asia: A study on the sanctions imposed on Iran," Energy & Environment, , vol. 34(1), pages 58-77, February.
    • Handle: RePEc:sae:engenv:v:34:y:2023:i:1:p:58-77
    DOI: 10.1177/0958305X211045768
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    Cited by:

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    2. Shi, Zhen & Yang, Xinyue & Jin, Qinqin & Chiu, Yung-ho & Zhang, Lina, 2025. "Roadmap to achieve sustainable energy development: Is energy security important to the path to SDG7: Affordable and Clean Energy -Sustainable Development Goals?," Renewable Energy, Elsevier, vol. 251(C).
    3. Kim, Sunjin & Park, Daehyeon & Ryu, Doojin, 2024. "Potential sanctions on the Northeast Asia supergrid: A network theory perspective," Energy, Elsevier, vol. 302(C).

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    Keywords

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    JEL classification:

    • N75 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Asia including Middle East
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General

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