OIL AND NATURAL GAS TRADE BALANCE AND PRODUCTION EFFECTS IN THE EUROPEAN UNION AND BLACK SEA ECONOMIC COOPERATION COUNTRIES

Authors

  • Evangelos Siskos Western Macedonia University of Applied Sciences (Technological Educational Institute of Western Macedonia)
  • Konstantia Darvidou Western Macedonia University of Applied Sciences (Technological Educational Institute of Western Macedonia)

DOI:

https://doi.org/10.35774/jee2017.03.261

Keywords:

Oil and natural gas industry, trade balance, mining, energy supply, employment, European Union, Black Sea Economic Cooperation.

Abstract

Most European Union and Black Sea Economic Cooperation countries are net importers of petroleum and natural gas. Searching for new deposits and construction of new pipelines can improve energy security in the region. The problem is topical for Greece which has a developed refinery industry and needs to improve its trade balance to repay the accumulated external and public debt. Several new pipeline initiatives through Greece can support relations between the EU and BSEC countries. The paper provides previous research review about energy dependency and the effects of trade, production and transportation of hydrocarbons. Next we provide analysis of the effect of the trade on balance of payments in both the EU and BSeC countries. Import dependency of GDP on oil and natural gas is especially large in Malta, Georgia, Ukraine, Serbia and Latvia. On the other hand Russia and Azerbaijan are large net exporters of hydrocarbons. Then we analyse the impact of mining on labour market and refinery industry development. On average larger value added in mining leads to larger employment at least for males and middle age group of people. But the effect largely varies across countries and time periods. Together with construction of new pipelines growth of extraction can result in dozens of thousands of new jobs in Greece. There is a close link between value added in mining and compensation of employees in that industry. We have found evidence that the clustering effect between mining and manufacture of refined petroleum products and coke exists only in some EU countries.

JEL: L71, L95, Q35, Q43, F14, J23.

Author Biographies

Evangelos Siskos, Western Macedonia University of Applied Sciences (Technological Educational Institute of Western Macedonia)

Doctor of Economic Sciences, Professor of International Economic Relations

Konstantia Darvidou, Western Macedonia University of Applied Sciences (Technological Educational Institute of Western Macedonia)

Ph. D. of International Economic Relations

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Published

16.04.2018

How to Cite

Siskos, Evangelos, and Konstantia Darvidou. “OIL AND NATURAL GAS TRADE BALANCE AND PRODUCTION EFFECTS IN THE EUROPEAN UNION AND BLACK SEA ECONOMIC COOPERATION COUNTRIES”. Journal of European Economy, vol. 16, no. 3, Apr. 2018, pp. 261-83, doi:10.35774/jee2017.03.261.

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