Economics of oil regulation and the Brazilian reformsome issues

Resumo

This paper reviews the economic fundamentals for regulation in the oil industry, with a focus on the current regulatory proposal for the Brazilian oil industry. The observed exploration and production (E&P) contracts foresee much of the characteristics of the optimal contract, with a remuneration structure that combines upfront with future payments to mitigate uncertainty and incentivize exploratory efforts. In Brazil, despite slow market deconcentration since 1997's liberalization, the current oil regulation is in general consistent with an optimal regulatory response. From an economic standpoint, the 2009's new regulatory proposal prompted by the major oil discoveries offshore in Brazil reduces the power of incentive schemes with respect to exploratory and cost-reducing efforts while the changes in the net risk of the E&P offshore activities are not so clear.

Ficha do documento

Tipo

Artigo científico

Ano

2011

Instituição

Fundação Getulio Vargas

Fonte

Repositório da FGV

Idioma

Inglês

Acesso

Acesso restrito

DOI

10.1016/j.enpol.2010.09.004

Identificador

oai:repositorio.fgv.br:10438/25369

Temas

EconomiaDesenvolvimento Econômico

Palavras-chave

Contract theory BrazilRegulation and developmentContract theoryDeconcentrationEconomic fundamentalsEconomic standpointsExploration and productionsIncentive schemesOffshore activityOil discoveriesOil industriesOptimal contractIndustryOptimizationLaws and legislationEnergy marketEnergy policyEnergy resourceHydrocarbon explorationLiberalizationOil industryOil productionBrazilEconomiaIndústria petrolífera - Regulamentação - BrasilIndústria petrolífera - Brasil