Table of Contents

International Handbook of Network Industries

International Handbook of Network Industries

The Liberalization of Infrastructure

Elgar original reference

Edited by Matthias Finger and Rolf W. Künneke

This extensive, state-of-the-art Handbook provides a comprehensive overview of the various experiences of liberalization across different sectors, regions and disciplines.

Chapter 12: The Oil Industry: A Dynamic Patchwork of Approaches?

Aad Correljé and Lucia van Geuns

Subjects: economics and finance, energy economics, institutional economics, public sector economics

Extract

Aad Correljé and Lucia van Geuns INTRODUCTION In the context of this book, the liberalization of infrastructures means: ‘to allow for more competition and involvement of the private sector, thus redefining the role of government’. Applying this notion to the oil, or petroleum, industry, yields a rather opaque perspective. There is no clear and consistent pattern observable throughout the industry as a whole. It is huge and complex, with a large variety in country-specific public–private relationships. Unlike other ‘infrastructures’, it is not organized on a national basis. Oil is found in some countries. Sometimes it is also refined into products there, but more often the crude oil is moved abroad for processing. Refined products may be marketed locally, but also exported to markets all over the world. These activities are organized according to the strategies of the companies involved and the policies and traditions of the countries where they take place. The operators are the numerous larger and smaller public and private oil companies, or public–private joint ventures. Together, these firms operate the loosely connected international network of flows, processes, storage and other activities that constitute the structure, or the value chain, of the industry. Transactions may be organized in a variety of ways, covering anything between the spot market and vertical integration. Depending on the countries involved, the public–private interaction is organized in different ways, while the pattern does not seem to show any unilateral movement into a more or less liberal ‘direction’. Rather, historically, the...

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