Resilience of international oil trade networks under extreme event shock-recovery simulations

TL;DR

This paper develops a simulation model to assess the resilience of international oil trade networks under extreme shocks, highlighting their capacity to recover and self-organize, which is vital for global energy security.

Contribution

It introduces a novel simulation-based approach and a resilience index to evaluate iOTN performance beyond traditional methods, considering resistance and recoverability.

Findings

Extreme events cause significant declines in network performance.

Resilience and recoverability tend to improve over time, indicating self-organization.

Shocks to major trading economies have the most severe impacts.

Abstract

With the frequent occurrence of black swan events, global energy security situation has become increasingly complex and severe. Assessing the resilience of the international oil trade network (iOTN) is crucial for evaluating its ability to withstand extreme shocks and recover thereafter, ensuring energy security. We overcomes the limitations of discrete historical data by developing a simulation model for extreme event shock-recovery in the iOTNs. We introduce network efficiency indicator to measure oil resource allocation efficiency and evaluate network performance. Then, construct a resilience index to explore the resilience of the iOTNs from dimensions of resistance and recoverability. Our findings indicate that extreme events can lead to sharp declines in performance of the iOTNs, especially when economies with significant trading positions and relations suffer shocks. The upward trend in recoverability and resilience reflects the self-organizing nature of the iOTNs, demonstrating its capacity for optimizing its own structure and functionality. Unlike traditional energy security research based solely on discrete historical data or resistance indicators, our model evaluates resilience from multiple dimensions, offering insights for global energy governance systems while providing diverse perspectives for various economies to mitigate risks and uphold energy security.