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Political limits on the world oil trade : firm-level evidence from US firms

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  • Kashcheeva, Mila

Abstract

International politics affect trade patterns, especially for firms in extractive industries. We construct the firm-level dataset for the U.S. oil-importing companies over 1986-2010 to test whether the state of international relations with the trading partners of the U.S. affect importing behavior of the U.S. firms. To measure "political distance" between the U.S. and her trading partners we use voting records for the UN General Assembly. We find that the U.S. firms, in fact, import significantly less oil from the political opponents of the U.S. Our conjecture is that the decrease in oil imports is mainly driven by large, vertically-integrated U.S. firms that engage in foreign direct investment (FDI) overseas.

Suggested Citation

  • Kashcheeva, Mila, 2013. "Political limits on the world oil trade : firm-level evidence from US firms," IDE Discussion Papers 401, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    • Handle: RePEc:jet:dpaper:dpaper401
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    References listed on IDEAS

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    1. Sergei Guriev & Anton Kolotilin & Konstantin Sonin, 2011. "Determinants of Nationalization in the Oil Sector: A Theory and Evidence from Panel Data," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 27(2), pages 301-323.
    2. Axel Dreher & Jan-Egbert Sturm, 2012. "Do the IMF and the World Bank influence voting in the UN General Assembly?," Public Choice, Springer, vol. 151(1), pages 363-397, April.
    3. Sergey Mityakov & Heiwai Tang & Kevin K. Tsui, 2012. "InternationalPolitics and Import Diversification in the Second Wave of Globalization," Discussion Papers Series, Department of Economics, Tufts University 0770, Department of Economics, Tufts University.
    4. Christopher Hajzler, 2012. "Expropriation of foreign direct investments: sectoral patterns from 1993 to 2006," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 148(1), pages 119-149, April.
    5. Sergey Mityakov & Heiwai Tang & Kevin K. Tsui, 2011. "Geopolitics, Global Patterns of Oil Trade, and China¡¦s Oil Security Quest," Working Papers 322011, Hong Kong Institute for Monetary Research.
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    Cited by:

    1. An, Haizhong & Zhong, Weiqiong & Chen, Yurong & Li, Huajiao & Gao, Xiangyun, 2014. "Features and evolution of international crude oil trade relationships: A trading-based network analysis," Energy, Elsevier, vol. 74(C), pages 254-259.
    2. Zhong, Weiqiong & An, Haizhong & Fang, Wei & Gao, Xiangyun & Dong, Di, 2016. "Features and evolution of international fossil fuel trade network based on value of emergy," Applied Energy, Elsevier, vol. 165(C), pages 868-877.
    3. Hu, Jun & Zhang, Yujie & Wu, Peng & Li, Huijia, 2022. "An analysis of the global fuel-trading market based on the visibility graph approach," Chaos, Solitons & Fractals, Elsevier, vol. 154(C).

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    More about this item

    Keywords

    United States; Petroleum; International trade; Petroleum industry; International relations; Oil imports; Political distance; FDI;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F51 - International Economics - - International Relations, National Security, and International Political Economy - - - International Conflicts; Negotiations; Sanctions
    • Q34 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Natural Resources and Domestic and International Conflicts

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