TITLE

The Target Revenue Model and the World Oil Market: Empirical Evidence from 1971 to 1994

AUTHOR(S)
Alhajji, A. F.; Huettner, David
PUB. DATE
April 2000
SOURCE
Energy Journal;2000, Vol. 21 Issue 2, p121
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
This study draws on other studies that concluded OPEC is not a cartel and Saudi Arabia acts as a dominant producer in the world oil market. The intention here is to see whether the Target Revenue (TR) model provides an explanation for the behavior of some OPEC members that do not coordinate production with Saudi Arabia. We investigate whether production cuts or increases by OPEC and non-OPEC members are based on their investment or budgetary needs. By retesting the TR model, we show that investment and budgetary needs do not affect the production of oil in free-market economies (OPEC and non-OPEC), but they do affect production decisions of the more centrally-planned, isolated and oil-dependent economies. Existing studies in the literature have conceptual and statistical limitations that justify retesting the model. This study is the first to investigate the TR model in a separate study and to compare the results of static and dynamic models. It is also the first to examine the relationship between the degree of economic freedom and the Target Revenue model and to note the TR model is stable when used for countries that are price takers.
ACCESSION #
3016135

 

Related Articles

  • Prices drop on OPEC decision.  // MEED: Middle East Economic Digest;12/5/2003, Vol. 47 Issue 49, p12 

    Reports on a decline in oil prices in relation to a decision by the Organization of Oil Producing & Exporting Countries (OPEC) to leave its output ceiling unchanged on December 4, 2003. Trading of Brent per barrel following the decision of OPEC; Reaction of producers to the move of OPEC to roll...

  • Rolling out the barrels. Dutta, Ashok // MEED: Middle East Economic Digest;11/3/2006, Vol. 50 Issue 44, p8 

    This article focuses on the growing doubts among observers that the Organization of Petroleum Exporting Countries (OPEC) will be able to keep to its commitment to deliver the output cuts its president promised at an emergency meeting in Doha, Qatar. OPEC called it "an act of interim...

  • OPEC Deadlocked As Iran, Saudis Harden Positions On Cuts Deal.  // Investors Business Daily;11/29/2016, p1 

    The article reports that the Organization of Petroleum Exporting Countries' (OPEC) latest deal to curtail oil production appeared in jeopardy as Iran decided not to make cuts while Saudi Arabia insisted Tehran must be willing to play a meaningful role in any agreement. Ministers gathering in...

  • Nigeria sticks with OPEC. Akanni, Fred // Offshore;Sep2002, Vol. 62 Issue 9, p20 

    Reports that Nigeria plans to remain as member of the Organization of Petroleum Exporting Countries (OPEC). Nigerian presidential adviser on petroleum Rilwan Lukman's speech during the year 2002 conference of the Society of Petroleum Engineers; Lukman's response to a report by the British...

  • Russian rigs to the rescue. Lavelle, Marianne // U.S. News & World Report;2/11/2002, Vol. 132 Issue 4, p48 

    Discusses the role of Russia in the international petroleum industry. Price of crude oil globally; Mention of the Organization of Petroleum Exporting Countries; Relations of the United States with the Russian oil industry; Outlook for the impact of Russia on the global petroleum industry.

  • OPEC--Will It Work? Fixler, L. Donald; Ferrar, Robert L. // Columbia Journal of World Business;Fall74, Vol. 9 Issue 3, p47 

    In this article the Middle East oil market will be analyzed in terms of the self-interest of the producing countries. Price and output policies which maximize the revenue and profit of oil exporting countries will be discussed. It is an acceptable practice in the West for producers to look after...

  • Will Iraq quit OPEC? Blanche, Ed // Middle East;Jul2003, Issue 336, p18 

    Iraq's position in the Organization of Petroleum Exporting Countries (OPEC) is in the balance following the American take over of the country. The U.S. conquest and occupation of Iraq has given America the control of one of the world's major oil producers, a country many believe has untapped...

  • OPEC--The Arab point of view. Fixler, L. Donald; Ferrar, Robert L. // Management Review;Mar75, Vol. 64 Issue 3, p35 

    Examines key issues relevant to the crisis in the petroleum industry and trade in the Middle East. Factors influencing the oil crisis; Strategies by which countries may cope with the oil crisis; Achievement of market power by oil-producing nations through membership to the Organization of...

  • Middle East oil exporters rise to the global challenge. Smith, Pamela Ann // Middle East;Feb2006, Issue 364, p40 

    The article focuses on the oil exporting countries in the Middle East including Saudi Arabia, which have witnessed a steady growth in the world oil market. The Middle East's oil exporting countries now rank at the top of the world list, above China and Asia's emerging markets, as well as the...

Share

Other Topics