The Cost-profit Analysis of Increasing Domestic Oil Supply--Based on Reducing Oil Import Dependent Effect
CHEN Yan
LIN Zhong-hao
Abstract：Oil import dependence has brought tremendous costs and economic risk for China. Increasing China's oil supply is one way of reducing oil import dependence. Based on the reducing the oil import dependence effect, the article analyses the economic viability of increasing domestic oil supply from three points of view, that is, profits of wealth transfer, potential GDP profits and macroeconomic adjustment profits, and from another three consideration of costs, namely, direct production costs, environmental costs and user costs. The result shows that the profits of increasing our domestic oil supply are more than the costs from the overall trend, and the net profit is increasing, especially as the high oil price. But, the elasticity of profit-cost is falling, which shows the relatively growth rate of overall costs is faster than growth rate of profits.
Keywords：oil import dependenceoil supplycost-profit analysis
Publication Date：2014-01-01
Online Publishing Date：2025-08-15(First online date of this platform, not the publication date of the document)
Pages：11( 40-50 )