Medium-Term Oil Market Report

Subject Prospects for the global coal market. Significance Seaborne thermal coal prices are on a long-term slide. Having peaked above 130 dollars per metric tonne (mt) for thermal coal delivered into north-western Europe in 2011, prices have sunk to 52.8 dollars/mt on September 7, the lowest level since 2009. At these prices, only the lowest-cost producers can remain profitable. In its 'Medium-Term Coal Market Report 2014', the International Energy Agency estimates that production costs for US Central Appalachian (CAPP) producers and Australian underground mining are close to 90 dollars/mt. Impacts Further coal sector bankruptcies and mine closures are likely. Coal will remain competitive with natural gas for power generation in most markets. Medium-term demand response will be limited by a lack of new coal plant construction and environmental regulation.

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BEHAVIOR OF THE GLOBAL OIL MARKET (1995-2008) AS DESCRIBED BY A SYSTEM DYNAMICS MODEL

Análise Econômica ◽

10.22456/2176-5456.18272 ◽

2011 ◽

Vol 29 (56) ◽

Author(s):

María de la Fe López-Domínguez ◽

Sary Levy-Carciente ◽

José Contreras ◽

Pedro César Paiva-Mata

Keyword(s):

Global Economy ◽

Sensitivity Study ◽

Structural Factors ◽

System Dynamics Model ◽

Dynamics Model ◽

Medium Term ◽

Oil Market ◽

Satisfactory Performance ◽

Production And Consumption ◽

Systemic Model

Energy largely determines the characteristics of the global economy, hence the importance of fully understanding the behavior of the oil market in its current geo-economic and political environment. Starting from the basic relations of the global oil market and their interactions with macroeconomic variables, a nonlinear dynamic, structural and systemic model for this market is developed, which simulates the price, production and consumption of oil, and the accumulation of inventories. Model tests show satisfactory performance in the simulation of the known past in a medium-term horizon, 1995-2008. A sensitivity study performed for the same period yield some interesting conclusions about the behavior of the global oil market, such as the irrelevance of the structural factors in the soaring rise in oil prices in 2008.

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