Research Article
A Policy of Strategic Petroleum Market Reserves
@INPROCEEDINGS{10.1007/978-3-319-03473-7_21, author={Michael Mitchell and Walter Beyeler and Matthew Antognoli and Marshall Kuypers and Robert Glass}, title={A Policy of Strategic Petroleum Market Reserves}, proceedings={Complex Sciences. Second International Conference, COMPLEX 2012, Santa Fe, NM, USA, December 5-7, 2012, Revised Selected Papers}, proceedings_a={COMPLEX}, year={2013}, month={11}, keywords={Complex Adaptive Systems Multi-Agent-Based Modeling Buffer Stocks Price Stabilization Strategic Resource Reserves Resource Scarcity}, doi={10.1007/978-3-319-03473-7_21} }- Michael Mitchell
Walter Beyeler
Matthew Antognoli
Marshall Kuypers
Robert Glass
Year: 2013
A Policy of Strategic Petroleum Market Reserves
COMPLEX
Springer
DOI: 10.1007/978-3-319-03473-7_21
Abstract
Unexpected price spikes in petroleum can lead to instability in markets and have a negative economic effect on sectors which rely on petroleum consumption. Sudden rises in the price of petroleum do not have to be long-term to cause negative, cascading impacts across the economy. Firms which make futures purchases or hedge against a higher price during a price spike can become insolvent when the price spike deflates. A policy is needed to buffer short-term perturbations in the petroleum market to avoid short-term price spikes. This study looks at the effects of implementing a Strategic Petroleum Market Reserve within a multi-agent Nation-State model which would utilize trading bands to determine when to buy and sell petroleum reserves. Our analysis indicates that the result of implementing this policy is a more stable petroleum market during conditions of resource scarcity.
