IDEAS home Printed from https://ideas.repec.org/a/eee/enepol/v132y2019icp654-664.html
   My bibliography  Save this article

Global emissions from crude oil: The effect of oil-deposit heterogeneity

Author

Listed:
  • Roberts, Gavin
  • Barbier, Edward
  • van 't Veld, Klaas

Abstract

We simulate future global oil production using a model that accounts for oil-deposit heterogeneity, in order to estimate future emissions and global warming associated with oil development. Oil-deposit heterogeneity causes development costs to increase as the stock of oil deposits is depleted. We calibrate our simulations to best estimates of heterogeneous global development costs. The underlying theory implies, and our simulations confirm, that when oil-deposit heterogeneity is large enough, some crude oil may optimally be left in the ground. Our results indicate that increasing degrees of deposit heterogeneity and higher carbon taxes lead to fewer cumulative emissions from oil by 2100, but that the Paris Agreement climate goals will be difficult to meet.

Suggested Citation

  • Roberts, Gavin & Barbier, Edward & van 't Veld, Klaas, 2019. "Global emissions from crude oil: The effect of oil-deposit heterogeneity," Energy Policy, Elsevier, vol. 132(C), pages 654-664.
    • Handle: RePEc:eee:enepol:v:132:y:2019:i:c:p:654-664
    DOI: 10.1016/j.enpol.2019.06.008
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0301421519303787
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.enpol.2019.06.008?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Soren T. Anderson & Ryan Kellogg & Stephen W. Salant, 2018. "Hotelling under Pressure," Journal of Political Economy, University of Chicago Press, vol. 126(3), pages 984-1026.
    2. Stern,Nicholas, 2007. "The Economics of Climate Change," Cambridge Books, Cambridge University Press, number 9780521700801, September.
    3. Okullo, Samuel J. & Reynès, Frédéric & Hofkes, Marjan W., 2015. "Modeling peak oil and the geological constraints on oil production," Resource and Energy Economics, Elsevier, vol. 40(C), pages 36-56.
    4. Roberto F. Aguilera & Roderick G. Eggert & Lagos C.C. Gustavo & John E. Tilton, 2009. "Depletion and the Future Availability of Petroleum Resources," The Energy Journal, , vol. 30(1), pages 141-174, January.
    5. Hassan Benchekroun & Gerard (G.C.) van der Meijden & Cees Withagen, 2017. "OPEC, Shale Oil, and Global Warming - On the importance of the order of extraction," Tinbergen Institute Discussion Papers 17-104/VIII, Tinbergen Institute.
    6. Charles F. Mason and Gavin Roberts, 2018. "Price Elasticity of Supply and Productivity: An Analysis of Natural Gas Wells in Wyoming," The Energy Journal, International Association for Energy Economics, vol. 0(Special I).
    7. Thomas Covert & Michael Greenstone & Christopher R. Knittel, 2016. "Will We Ever Stop Using Fossil Fuels?," Journal of Economic Perspectives, American Economic Association, vol. 30(1), pages 117-138, Winter.
    8. Brown, Stephen P.A., 2017. "Natural gas vs. oil in U.S. transportation: Will prices confer an advantage to natural gas?," Energy Policy, Elsevier, vol. 110(C), pages 210-221.
    9. Myles R. Allen & David J. Frame & Chris Huntingford & Chris D. Jones & Jason A. Lowe & Malte Meinshausen & Nicolai Meinshausen, 2009. "Warming caused by cumulative carbon emissions towards the trillionth tonne," Nature, Nature, vol. 458(7242), pages 1163-1166, April.
    10. William D. Nordhaus, 2007. "A Review of the Stern Review on the Economics of Climate Change," Journal of Economic Literature, American Economic Association, vol. 45(3), pages 686-702, September.
    11. Robert D. Cairns & Graham A. Davis, 2001. "Adelman's Rule and the Petroleum Firm," The Energy Journal, , vol. 22(3), pages 31-54, July.
    12. Nicholas Stern, 2008. "The Economics of Climate Change," American Economic Review, American Economic Association, vol. 98(2), pages 1-37, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Mohamed Ouédraogo & Daiyan Peng & Xi Chen & Shujahat Haider Hashmi & Mamoudou Ibrahima Sall, 2021. "Dynamic Effect of Oil Resources on Environmental Quality: Testing the Environmental Kuznets Curve Hypothesis for Selected African Countries," Sustainability, MDPI, vol. 13(7), pages 1-23, March.
    2. Enisan, Akinlo A., 2023. "Oil Sector and Carbon Emissions in Nigeria: Asymmetry Analysis," African Journal of Economic Review, African Journal of Economic Review, vol. 11(2), March.
    3. Wei, Yu & Zhang, Jiahao & Bai, Lan & Wang, Yizhi, 2023. "Connectedness among El Niño-Southern Oscillation, carbon emission allowance, crude oil and renewable energy stock markets: Time- and frequency-domain evidence based on TVP-VAR model," Renewable Energy, Elsevier, vol. 202(C), pages 289-309.
    4. Haider Mahmood & Tarek Tawfik Yousef Alkhateeb & Maham Furqan, 2020. "Oil sector and CO2 emissions in Saudi Arabia: asymmetry analysis," Palgrave Communications, Palgrave Macmillan, vol. 6(1), pages 1-10, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gregory Casey, 2024. "Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 91(1), pages 192-228.
    2. van den Bijgaart, Inge & Rodriguez, Mauricio, 2023. "Closing wells: Fossil development and abandonment in the energy transition," Resource and Energy Economics, Elsevier, vol. 74(C).
    3. van den Bijgaart, Inge & Rodriguez, Mauricio, 2020. "Closing wells; fossil exploration and abandonment in the energy transition," Working Papers in Economics 789, University of Gothenburg, Department of Economics.
    4. Okullo, Samuel J. & Reynès, Frédéric & Hofkes, Marjan W., 2021. "(Bio-)Fuel mandating and the green paradox," Energy Economics, Elsevier, vol. 95(C).
    5. Melissa Dell & Benjamin F. Jones & Benjamin A. Olken, 2014. "What Do We Learn from the Weather? The New Climate-Economy Literature," Journal of Economic Literature, American Economic Association, vol. 52(3), pages 740-798, September.
    6. Philippe Aghion & Antoine Dechezleprêtre & David Hémous & Ralf Martin & John Van Reenen, 2016. "Carbon Taxes, Path Dependency, and Directed Technical Change: Evidence from the Auto Industry," Journal of Political Economy, University of Chicago Press, vol. 124(1), pages 1-51.
    7. Pindyck, Robert S., 2012. "Uncertain outcomes and climate change policy," Journal of Environmental Economics and Management, Elsevier, vol. 63(3), pages 289-303.
    8. George Economides & Anastasio Xepapadeas, 2019. "The effects of climate change on a small open economy," CESifo Working Paper Series 7582, CESifo.
    9. Freeman, Mark C. & Groom, Ben, 2016. "How certain are we about the certainty-equivalent long term social discount rate?," Journal of Environmental Economics and Management, Elsevier, vol. 79(C), pages 152-168.
    10. Vincent Martinet & Pedro Gajardo & Michel De Lara & Héctor Ramírez Cabrera, 2011. "Bargaining with intertemporal maximin payoffs," EconomiX Working Papers 2011-7, University of Paris Nanterre, EconomiX.
    11. Tumen, Semih & Unalmis, Deren & Unalmis, Ibrahim & Unsal, D. Filiz, 2016. "Taxing fossil fuels under speculative storage," Energy Economics, Elsevier, vol. 53(C), pages 64-75.
    12. Rick van der Ploeg, 2020. "Discounting and Climate Policy," CESifo Working Paper Series 8441, CESifo.
    13. David Anthoff & Richard Tol, 2009. "The Impact of Climate Change on the Balanced Growth Equivalent: An Application of FUND," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 43(3), pages 351-367, July.
    14. Brian Chi-ang Lin & Siqi Zheng & Xiangzheng Deng & Zhan Wang & Chunhong Zhao, 2016. "Economic Evolution In China Ecologically Fragile Regions," Journal of Economic Surveys, Wiley Blackwell, vol. 30(3), pages 552-576, July.
    15. Ulph, Alistair & Ulph, David, 2009. "Optimal Climate Change Policies When Governments Cannot Commit," SIRE Discussion Papers 2009-42, Scottish Institute for Research in Economics (SIRE).
    16. Scrieciu, S. Şerban & Barker, Terry & Ackerman, Frank, 2013. "Pushing the boundaries of climate economics: critical issues to consider in climate policy analysis," Ecological Economics, Elsevier, vol. 85(C), pages 155-165.
    17. Alistair Ulph & David Ulph, 2009. "Optimal Climate Change Policies When Governments Cannot Commit," Discussion Paper Series, School of Economics and Finance 200909, School of Economics and Finance, University of St Andrews.
    18. Kousky, Carolyn & Kopp, Robert E. & Cooke, Roger M., 2011. "Risk premia and the social cost of carbon: A review," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 5, pages 1-24.
    19. Buchholz, Wolfgang & Schumacher, Jan, 2010. "Discounting and welfare analysis over time: Choosing the [eta]," European Journal of Political Economy, Elsevier, vol. 26(3), pages 372-385, September.
    20. Simon Dietz & Anca N. Matei, 2013. "Spaces for agreement: a theory of Time-Stochastic Dominance," GRI Working Papers 137, Grantham Research Institute on Climate Change and the Environment.

    More about this item

    Keywords

    Energy; Crude oil; Exhaustible resources; Carbon emissions; Climate change;
    All these keywords.

    JEL classification:

    • Q30 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - General
    • Q35 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Hydrocarbon Resources
    • Q47 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy Forecasting
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

    Statistics

    Access and download statistics

    Corrections

    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:eee:enepol:v:132:y:2019:i:c:p:654-664. See general information about how to correct material in RePEc.

    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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/enpol .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.