IDEAS home Printed from
   My bibliography  Save this paper

Quantification of Political Risk in Energy Foresight - A Method Overview


  • Christoph Weber

    (Chair for Management Sciences and Energy Economics, University of Duisburg-Essen)


Uncertainty is almost ubiquitous in energy related decision making. It has many sources, multiple facets and numerous implications. From the uncertainties surrounding Global Warming over the incertitude of future technological progress to the volatility of fuel and other energy prices, the uncertainties account for an important part of the current energy strategy puzzle. One key element of this puzzle is however political risk. Especially when it comes to the supply of oil and gas, where around 70 % of the worldwide resources are concentrated in what is sometimes labelled the "strategic ellipse" (cf. e.g. Rempel et al. 2006), encompassing the region from the Arabian peninsula over the surroundings of the Caspian Sea up to the most important Siberian hydrocarbon reservoirs. How should political risk be taken into account when aiming at solving the energy strategy puzzle? This is the key issue addressed in this paper, however with a clear focus on the first step of strategic decision making, namely the environment analysis. Thereby environment does not mean only the natural environment but the entire surrounding world which is relevant for the decision making. Consequently the first point to be discussed in the following is energy related decision making in general and the role of risk herein in particular (cf. Section 2). Then a typology of risks and especially political risks is sketched in Section 3 before approaches to the modelling and quantification of political risk are reviewed in Section 4.

Suggested Citation

  • Christoph Weber, 2010. "Quantification of Political Risk in Energy Foresight - A Method Overview," EWL Working Papers 1001, University of Duisburg-Essen, Chair for Management Science and Energy Economics, revised Feb 2010.
  • Handle: RePEc:dui:wpaper:1001

    Download full text from publisher

    File URL:
    File Function: First version, 2010
    Download Restriction: no

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    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:dui:wpaper:1001. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: .

    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.

    We have no bibliographic references for this item. You can help adding them by using 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: Andreas Fritz (email available below). General contact details of provider: .

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.