Petroleum Business Review

Abstract Considering global warming and importance of sustainable growth in economic sub-sectors, this paper presents and estimates an empirical model of renewable energy consumption for the industrial sector of selected OPEC and non-OPEC countries over the period 1990-2014. Panel co-integration estimates by Pedroni (1999,2004) and Westerlund (2005,2006) show that, in the long term, increases in industrial value added per capita, real oil prices, and CO2 per capita are found to be major drivers behind per capita renewable energy consumption for both OPEC and Non-OPEC nations. Panel Granger causality by the Dumitrescu and Hurlin (2012) method confirms that there are bi-directional causality relationship between research variables and therefore verify feedback hypothesis. Finally, FMOLS and DOLS results show that when industrial value added per person increases, per capital renewable energy consumption increases by greater magnitude in non-OPEC than OPEC countries; also an increase in CO2 emissions per person increases per capita renewable energy consumption by greater amount in non-OPEC than OPEC nations.

Abstract The purpose of this study is to evaluate the financial performance of provincial gas distribution companies as affiliates for National Iranian Gas Company. To this end, we identified financial performance indicators in accordance with the requirements of NIGC through a review of theoretical foundations and interviews with a number of financial and planning experts and then prioritized using the Analytical Hierarchy Process method. These indicators lied in four groups of liquidity, capital structure, profitability and activity criteria, respectively. Then, the weighted indicators were analyzed using TOPSIS technique in Expert-Choice software and the final ranking of the companies was provided. The results showed that based on the identified criteria, provincial gas companies of Hormozgan, Yazd, Markazi, and Kermanshah had a favorable financial performance and Ilam, Mazandaran, Chaharmahal and Bakhtiari and Zanjan provincial gas companies had a weak financial performance with respect to other companies in three years under review and some suggestions have been made in this regard.

Abstract Expanding use of renewable energies (RE) around the world is a critical mission to reach to global environmental policies. Largest share of global energy mix relates to deployable and carbon-intensive fossil fuels. So, it is necessary to create proper incentives for investors to invest in RE in order to move toward low carbon economy. In this regard, one of the implemented policies is imposing tax on using deployable energies which includes tax on both energy consumption and motor vehicle transportation. This paper investigates impact of environmental tax policy on investors’ behavior for 13 leading selected developed and developing countries during the period 2004-2016. Based on economic theory, investment, particularly in capital-intensive energy industries would have a long gestation period. To capture this feature and evaluate dynamic relations of investments in RE, a partial-adjustment dynamic model is applied and estimated using Generalized Method of Moments (GMM) method. The results show that imposing tax on fossil fuel energy consumption and transportation systems, in particular that use fossil fuels, has a significant negative and positive impact on investing in RE, respectively. Also, empirical results demonstrate that there is a significant negative relation between interest rate (IR) and Investments in Renewable Energies (IRE).

Abstract This study aimed to evaluate the effects of environmental policies including price and non-price policies on natural gas demand in Iranian industrial sector. For this purpose, considering the dynamic nature of our panel data, we adopted Generalized Method of Moments (GMM) method to estimate natural gas consumption for 22 Iranian industries from 2005 to 2015. The results illustrated that the annual average of natural gas consumption has been rising, reaching five times higher than the consumption of other fossil fuels. Among the industries, other non-metallic minerals industry with 8 percent of the total production and more than 25 percent natural gas consumption have been regarded as the most natural gas consumer industry. The results of our GMM model showed that non-price environmental policies are more effective than the price policies on natural gas consumption. Overall, in non-price policies, energy intensity seems more important comparing to CO2 emission reduction. We recommend that governmental energy policies should focus more on energy intensity improvement in Iranian industries through technological enhancement and fuel energy saving regulations.

Abstract
This paper explores the impact of crude oil futures prices on risk premium volatilities in the NYMEX futures market. For this purpose, the ARCH and GARCH methods are used to model risk premium volatilities and explore how crude oil futures prices influence the risk premium volatilities in futures contract with a maturity of one-month, two-month and three-month over 1990-2014. In addition, it examines the impact of various maturities for futures contracts. The results indicate positive and statistically significant relationship between risk premium volatility and crude oil futures prices, and this relationship varies across the maturity length with change in maturity length. The longer the futures maturities, the higher the impact of futures crude oil prices on risk premium volatility is anticipated.

Abstract Recent theories of firm dynamics emphasize on the role of financial variables as determinants of firm growth. Most of the technical literature shows that there is a positive relationship between financial leverage and firm growth. The purpose of this paper is to examine whether such relationship exists among oil and gas companies within the Organization of the Petroleum Exporting Countries (OPEC). Data were collected from the selected members of the OPEC. The collected data was then analyzed using the Arellano and Bond (1991) GMM method and Sargan test. The results showed a significant and positive relationship between financial leverage and firm growth which is in line with the technical literature. This research contributes to the body of knowledge by examining a specific and important sector within several different countries. It shows the current theory is not affected by industry or country.

Abstract As the largest exporter of non-oil products, the petrochemical industry’s growth and development have a significant role in economic prosperity. Considering the sanctions on crude oil exports in recent years and the problem of crude oil sales, it is essential to pay attention to this industry as an influential factor in circumventing sanctions and currency for the country, developing its economic strategy, and achieving sustainable economic development. In this study, the factors affecting the supply of methanol exports to the UAE, Turkey, China, and India export destinations in the period 2001–2009 are examined and analyzed. According to the studies, the factors that have affected the supply of Iranian methanol exports are the GDP of target countries, real exchange rate, exchange rate fluctuations, trade liberalization, price exchange ratio, refinery feed prices, and sanctions as the livestock variables. In this study, the actual exchange rate volatility index was estimated using the GARCH model. Then, the export supply model of Iran’s methanol product was calculated by the ARDL method. According to studies, the variables of GDP and trade liberalization have a positive and significant effect on the supply of Iranian exports in the short and long term. Still, other variables have a negative and significant impact on the supply of Iranian exports in the short and long term.

Abstract The Arash (Al-Durra) gas field, located in the northern Persian Gulf, is a shared natural resource claimed by Iran, Kuwait, and Saudi Arabia. Ongoing maritime boundary disputes have made the development of this field a geopolitical and legal challenge. Game theory is used in this research to model the strategic interactions between the three states under various cooperation and competition scenarios. The results indicate that trilateral cooperation would be the greatest economic and security benefits for all parties; however, political tensions and legal barriers, particularly Iran’s non-membership in the United Nations Convention on the Law of the Sea (UNCLOS), hinder such outcomes in the short term. Iran experiences the greatest losses under competitive strategies, while Saudi Arabia and Kuwait benefit more from bilateral agreements. The study also explores how Iran’s legal position could be strengthened through accession to UNCLOS and the adoption of a flexible strategy that combines active diplomacy with cautious resource exploitation. This approach could improve Iran’s bargaining power and reduce its isolation in the dispute. The research offers a comprehensive analysis of the legal, geopolitical, and economic dimensions of the Arash field conflict and provides actionable policy recommendations to reduce tensions and promote equitable, long-term resource sharing in the region.

Abstract Energy has been always the focus of attention since the establishment of the WTO.The significance of this issue was doubled when the major energy-producing countries states sought to join the WTO.To join the WTO,many energy-producing and energy-exporting states inevitably needed to modify and change their own laws.The adoption of a dual pricing policy by the applicant countries appears as one of the controversial issues in this regard.By determining lower energy prices for their domestic producers,the energy-rich countries provide them with a superior position relative to their international rivals.From the perspective of some energy-importing countries,such behaviors are seen as subsidizes.Iran as one of the largest energy-rich states,has been seeking about twenty years to join the WTO.Iran subsidizes its domestic producers to support its energy sector and infant industries.This article focused on examining the pricing policies,and in particular,the approach to determine the price of energy in Iran.In addition,we studied of the impact of the pricing method of the energy sector in Iran on the process of its accession to the WTO by a comparative evaluation of the accession process of the energy-producing countries such asRussia andSaudi Arabia to the WTO.Through studying the laws and regulations of the energy sector of Iran, one can realize that Iran has been distancing from DP in recent years and is striving to approach the price of its energy to the global price by benefiting fromthe experiences of the performance of the membercountries of the WTO aimed at accelerating the process of its accession to the WTO

Abstract The main purpose of this research is to explain why and how the stock liquidity affects the default risk of petrochemical and petroleum products companies listed in Tehran Stock Exchange. The study used experimental data and parametric tests in order to estimate the relationship between stock liquidity and default risk through information efficiency and corporate governance roles of stock liquidity. The present research is applied in terms of purpose and is a descriptive-correlative study. All data required regarding the stock liquidity, price, trading volume and days, stockholder ownerships, etc., were extracted from Rahavard Novin database software. To investigate the relationship between variables, the multivariate regression analysis model using OLS method was applied in Eviews platform. The empirical findings showed that there is a significantly negative relationship between stock liquidity and default risk of petrochemical and petroleum product companies listed in TSE and also stock liquidity can affect the default risk through reducing the information asymmetry in the stock pricing process and strengthen the corporate governance. These results could provide visible signals based on the realities of the market in order to improve models to assess and predict the risk of default and lead managers and decision makers of suppliers, customers, partners and stakeholders, to conclude more flexible contracts with petrochemical and petroleum products companies and ultimately better mitigate business risks.

Abstract Rapid changes and competitions in today's world have shifted the role of governmental enterprises into regulating and directing activities. This has led to the need for the analysis of internal/ external situations and the revision of strategic planning of such companies. The Iranian Oil Terminals Company, as one of the National Iranian Oil Company subsidiaries, has developed its vision, mission, and strategic plan. In this paper, the strategic planning was fulfilled for the Procurement and Supply system of IOTC, which has the role of supporting the primary activities of the company by sourcing, purchasing, warehousing, and delivering the requested materials. In this regard, different models of strategic planning were reviewed to design a suitable approach for strategy formulation. The adopted framework was implemented using the balanced scorecard approach and the results were presented step by step in the paper. . . . . . . . . . . .

Abstract This paper aims to show the asymmetric effect of oil shocks on Iran’s economy. It uses nonlinear time series models to investigate the asymmetric effect of oil shocks on resource allocation in Iran’s economy. The results show that adverse oil shocks have been more persistent during the last decades and severely negatively affect resource allocation in Iran’s economy. Different oil shocks have different implications for importing and exporting countries, and the rigidity of state fiscal systems in exporting countries causes adverse oil shocks to be more persistent. The oil economy’s response to positive and negative oil shocks depends on the structure of the economy. The government budget and trade balance have significant implications for the effects of oil shocks on oil-exporting economies. The government budget is highly dependent on oil revenues, so in the case of adverse oil shocks, the pass-through exchange rate will cause high inflation because of foreign exchange shortage and overshoot in the exchange rate. 

Abstract Abstract

By regulating the general policies of Article 44 of the Constitution law, downstream oil and gas industries were handed over to the private sector. Bunkering industry or supplying fuel to the ships is identified as one of the downstream industries of oil and gas. Despite having opportunities, such as abundant sources of high-quality fuel, Iran has not been able to play a key role in bunkering industry in the Persian Gulf. Notwithstanding the emphasis of the laws on supporting the private sector, many of the policies have problems in implementation. Expanding the activity of the private sector by analyzing the necessity of creating an independent regulatory body, that will follow single governance at the same time as removing government monopolies is the main goal of this research. The findings of the research show that the bunkering value chain is still under the control of the government, and regulation in the bunkering industry should be done with an integrated and supportive approach with the participation of organizations related to this industry and private sector activists.

Abstract Technology Transfer is a process which technology supplier can transfer technology to receiver through it by numerous activities. Now in Iran, lots of companies are facing difficulties in correct implementation of technology transfer. Varying complexity and specific nature of each of the technologies has been caused many problems to technology transfer process design. In the other hand, the lack of integration between the components of the technology transfer process and the lack of consistency in the way of transferring with the company's strategies has been caused additional difficulties. In this paper, we have attempted to design the model of technology transfer process in the Oil, Gas and Petrochemical industry which includes three stages of " decision making, technology transfer and acquisition the knowledge".The model is derived from the literature survey and is developed based on the experiences with adding necessary elements in order to resolve the problems. In order to validate the model, it is used for DMD technology transfer in RIPI.

Abstract The purpose of the current work, conducted in 2017 and 2018, is to identify and
prioritize the qualitative and quantitative factors affecting human resources
(HR) valuation at National Iranian Oil Company and its subsidiaries. Using a
snowball sampling method, 28 experts were selected from the head of human
resources, the head of finance, and some staff members of National Iranian
Oil Company and its subsidiaries. In order to identify the dimensions and
components affecting human resources valuation, a comprehensive literature
review at international and national levels, interviews with experts, and
three stages of distribution and collection of questionnaires using the Fuzzy
Delphi method were performed. Then, two phases of the paired comparison
questionnaire were developed and provided for the experts to explain and
evaluate the cause-and-effect relationships between the dimensions and
the components together. The specified components and dimensions were
prioritized using the Fuzzy DEMATEL method. Using the Fuzzy Delphi
method, 15 dimensions and 101 components influencing HR valuation were
identified at National Iranian Oil Company and its affiliated companies.
According to Pareto 20-80, 20 components were identified as the factors
influencing human resources valuation at National Iranian Oil Company and
its subsidiaries, and using the Fuzzy DEMATEL method, 15 dimensions
and 20 specified components were prioritized. According to the results
obtained, the most important dimension and component affecting human
resources valuation at National Iranian Oil Company and its subsidiaries are
job satisfaction, motivation, and perseverance in employees’ assignments.

Abstract Unlike many arbitrations, the arbitration procedure for price reviews in gas industry contracts is not based on allegations that one party has breached a contract or otherwise committed a legal wrong. Instead, arbitrators are asked to determine whether the economics of a contract has been changed in the market and thus should be adjusted; if so, a new price formula should be established. Due to the complexity of the revision of gas prices, the gas experts have significant role in these arbitrations. Regarding the role of gas experts, gas price arbitrations have specific nature. In this article, the nature of these arbitrations is examined to establish whether they are arbitration or expert determination as one of alternative dispute resolutions (ADR). Iran has the second proven natural gas resources worldwide and is the third natural gas producer in the world, so Iran–Turkey case will come under scrutiny in this article.

Abstract Economic sanctions imposed on heterogeneous states have played an important role as a tool of pressure in recent decades. Considering that most states nonconforming with the US are important players on the energy market, large part of this country’s sanctions policies has focused on the energy sector. With the evolution of the US shale oil industry, using energy as a tool of sanctions against target countries has received increasing attention by the US presidents in recent years. The US is using the geopolitical shift as an international strategy to compete with other powers in the energy sector such as Iran, Venezuela, and Russia. The US aims to use its energy embargo policy to curtail the influence of these players on the energy market and prevent their anti-American policies by fermenting economic crises within these countries. The question arises as to the extent of the effectiveness and sustainability of this US foreign policy strategy in a transitional international order. The article hypothesis is that due to inefficient unconventional resources in terms of market crisis, the rise of counter-hegemonic coalitions, and geopolitical tensions in regions such as the Middle East, one cannot be too optimistic about the sustainability of this situation. The authors of the article will endeavor to explain the above hypothesis within the framework of the hegemony theory and by using the trend-analysis technique while addressing the driving forces.

Abstract The purpose of this study is to level the optimal analytical topics for evaluating the cost of petrochemical stock in the capital market. In this study, which was synthetic and inductive-deductive in terms of data collection method, 12 accounting and financial management specialists at the university level participated as panel members in the quality department. In fact, in the qualitative part, which used meta-synthesis and Delphi analysis, the aim was to identify the optimal analytical themes for the valuation of cost-effective stocks and then, in a small section with the participation of 16 petrochemical brokers, to classify the identified statements in the form of a total interpretive structural modelling based on impact priority. Therefore, relying on meta-synthesis analysis, 12 studies were first evaluated as the basis for evaluation to determine the optimal analytical themes of cost-based stock valuation based on critical evaluation, based on which 11 themes were selected propositions and entered into Delphi analysis to determine theoretical adequacy. In this stage, 3 propositions were removed during the two stages of Delphi analysis and a total of 8 analytical propositions of stock valuation were economically entered into the quantitative analysis section, ie total interpretive structural analysis. In this section, the results show the most influential analytical themes of cost-effective stock valuation in the petrochemical industry, two statements of normal stock market price analysis based on the current rated price of "K2" and a focus on the net asset value is "K3", which is at the fourth level of this model.

Abstract Project portfolio management is a comprehensive framework for decision making and selecting the portfolio of projects to achieve the goals of the organization by considering resource constraints. The importance of this issue in Iran's oil and gas industry is even more remarkable than ever due to its unique position in the country's economy, capital-intensive and capital budget constraints that have been intensified in recent years. Identifying and defining different scenarios for each oil and gas field, determining the parameters of the mathematical model, the required data to calculate the parameters of the model and the process and methods of identifying this data, indicate the distinction and necessity of this research. This study is an applied research in terms of objective, using mathematical modeling approach, has provided a pattern to determine the optimal portfolio of capital plans of oil and gas companies. The research method is case study which has studied one of the most important oil and gas producing companies in the country and the only offshore company. In this study, a framework for selecting the optimal portfolio of capital projects is determined and after gathering required data, the zero-one integer linear mathematical programming model with the objective function of maximizing the net present value from fields (as the strategic goal of company) by considering investment constraints was designed and solved by GAMS software. Finally, according to the defined constraint, the best investment mode for each field was identified and the optimal portfolio was defined.

Abstract Performance management is a systematic approach that helps to improve the organization's performance through the processes of setting strategic goals, measuring, collecting, and analyzing data, reviewing performance data reports, and applying its results. An evaluation and monitoring system in the form of performance management At the macro level, which monitors the upstream documents, development plans, etc. in the form of one-year or even fewer time schedules, and provides the necessary feedback to pave the way to achieve the vision at different structural and management levels, one of the necessities which is currently the main question of the research entitled "Which is the appropriate model for managing the performance of managers?". To achieve this goal, the factors were identified using a qualitative and quantitative combined approach. In the qualitative phase of the Systematic literature method (SLR) and Delphi technique. The articles and documents selected in the systematic literature method (SLR) were evaluated in terms of quality through the CASP method. Based on the findings, 6 factors were identified as effective factors on performance. Managers were identified as external organizational factors - internal organizational factors - individual factors - input elements - performance management processes - results. Each of these factors has been used separately or in combination in various articles and research.

Abstract It seems that paying attention to social responsibility by companies can lead to a better stakeholder’s view toward the company, thereby increasing their loyalty and trust. Having the ability to obtain more financial resources in times of crisis, due to the greater loyalty of investors, will result in reducing the company risk. In contrast, being overconfident about the loyalty of individuals to the company can lead to keeping a short-term debt structure, thereby increasing the risk of obtaining financial resources. Recently, the negative impacts of petrochemical companies on the environment have made social and environmental groups focus more on this industry, and this focus has pushed companies into involving in more social activities. Considering the potential impact of CSR on the company’s risk, this study examines the relationship between corporate social responsibility and value at risk in petrochemical industry using a sample of 27 companies listed on the Tehran Stock Exchange during the 2010-2017 period. Eviews 10 is used for computing and analyzing the data, and the generalized auto regressive conditional heteroskedasticity (GARCH) model is employed to estimate value at risk. The results indicate a negative and statistically significant relationship between corporate social responsibilities and company value at risk.
 
 

Abstract Southeast Asian countries have always been the focus of oil producers due to the increase in population and the trend of economic growth. In the last two decades, Indonesia has been prioritized as one of the new markets for Iran due to its high population and forecast to become the fifth largest economy in the world and the upward trend of energy demand. The purpose of this research is to investigate the capacities of Indonesia using the documentary library research method. Indonesia is a developing country and has an increasing economic and population growth trend, which is facing an increasing demand for energy. For this reason, this market is always the focus of major oil producers.

The results of this research show that the refinery capacity of Indonesia's need for petroleum products in the form of joint venture or take-off method to create a sales chain in this country can increase its dependence on Iran. And as a result, more market share can be obtained and also the joint investment cooperation in the upstream development sector with Indonesian oil companies in the direction of developing its fields is also significant. The first question in this research is “what are the capacities of joint cooperation with Indonesia in the field of oil industry”, and the second question is “what are the capacities of joint cooperation between Iran and Indonesia in the field of oil industry?”

Abstract Climate change is a global issue, driven largely by greenhouse gas emission, with carbon dioxide (CO2) being the biggest contributor. Iran, one of the top 10 emitters globally, faces unique challenges in reducing its CO2 emission due to economic sanctions, data gaps, and limited experience with climate policy. To help guide decision-makers, this study uses the Simplified DICE model—DICE model is a widely accepted tool for analyzing climate and economic interactions—to evaluate different strategies for emission reduction. These strategies mainly include carbon pricing, investment in renewables as mitigation of emission growth, and improving energy efficiency. The results show that such policies can positively impact GDP, temperature stabilization, and emission levels. This research provides the first numerical framework tailored to Iran’s specific context, offering practical insights for policymakers. Key policy implications include the necessity to overcome sanctions in aspects of Investment and technology absorption, improved data collection to refine future analyses, and adopting cost-effective measures that balance economic growth with environmental sustainability.

Abstract International oil and gas investment disputes constitute an important part of investor-state dispute settlement (ISDS) system. Investment arbitration which is regarded as a prevalent dispute settlement mechanism in this area has come under severe criticism since it creates huge costs, lengthens the process, and devastates the parties’ long-term investment relationship. In recent years, the possibility of applying alternative dispute resolution (ADR) and hybrid dispute settlement mechanisms has largely been discussed. Mediation-arbitration (Med-Arb) is one of the hybrid integrated dispute settlement mechanisms which embodies flexibility, nonjudicial, and negotiate-oriented benefits of mediation and the finality advantage of arbitration simultaneously in a single process. In this method, mediation is first attempted by the parties before arbitration could be started; if settlement is not reached during the mediation phase, the appointed neutral or mediator will then act as (an) independent arbitrator(s), will continue the case under the arbitration process, and will render a binding arbitration award. In this method, if parties reach an agreement during the first phase (mediation process), they will not incur huge costs of lengthy investment arbitration. In this method, even if the first stage (mediation process) fails, since it has further clarified and narrowed down the disputes, then the arbitration process will be less lengthy and proceed more efficiently. Moreover, both investors and host states in oil and gas investment area do have strong ambitions to maintain the investment relationships. These goals are achieved better via adopting Med-Arb proceedings. The most noted concerns in this method relates to the issue of the impartiality of the neutral (mediator in the first stage) who acts as an arbitrator at the next stage. In other words, it may be argued that the confidential information learned by the neutral from the parties in the mediation stage may seriously impact on his/her impartiality in the arbitration stage. This issue can be responded in light of respecting party autonomy principle which selects the Med-Arb clearly and correctly for dispute settlement. This approach is affirmed and proposed by the UNCITRAL model law on international commercial conciliation (2002) as well. Also, concerns regarding the enforcement of international agreements resulting from mediation have already been addressed in the United Nations Convention on International Settlement Agreements Resulting from Mediation (Singapore Convention on Mediation), which has attained international acceptance by 51 state members so far.

Abstract The present paper is meant to answer the question: How fluctuation in economic growth rate increased the risk of instability in Iran in the Post-JCPOA? In response and based on reliable data and taking a political economy approach, it is hypothesized that the high fluctuations in the economic growth rate associated with JCPOA has led to the political instability through deepening and intensification of expectations gap. To do so and using a comparative method, a number of factors associated with calculating modes of added value (sub-sectors including agriculture, oil, industry and mining, and ) as well as international indicators affecting the economic growth are analyzed in the two time spans of pre and post JCPOA. For further validity, reference is made to the results of some polls conducted by some credible institutes. The findings show that the sudden rise and fall of the economic growth rate due to oil revenues after the agreement turned the hope created in the context of the expected gap formed by the promises of the agreement into disappointment; and paved the way for street unrests