The Effect of Biofuels on Crude Oil Markets
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To quantify the effect of biofuel on global oil markets, we extend the optimal export tax model to the global fuel market (henceforth, denoted as the Cartel-of-Nations model), recognizing that crude oil extraction and production are concentrated in a few countries (namely, the Organization of the Petroleum Exporting Countries), and that there is a wedge between fuel prices in oil-exporting and oil-importing countries. We calibrate the Cartel-of-Nations model to include biofuel using 2007 data.
AgBioForum, 13(2) 2010: 112-118.