Choosing the Overall Size of the Strategic Petroleum Reserve.

Abstract

The purpose of the Strategic Petroleum Reserve(SPR) is to diminish U.S. vulnerability to, as well as to offer protection against, possible future oil embargoes. This paper formulates the problem of determining the optimal size of SPR as a parametric bimatrix game between the U.S. and its potential opponent. The strategies of the opponent are embargoes of various intensities and lengths, including of course the no embargo option. The strategies of the U.S. are various ways of using the reserve. The size of the reserve itself is a parameter present in both payoff functions. Solving the game for the relevant reserve, as well as on U.S. drawdown policies in case of an embargo. The crucial element in the game-theoretic approach is that, unlike the traditional cost-benefit analysis, it fully captures the embargo-deterrent effect of an appropriate Strategic Petroleum Reserve. (Author)

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Document Details

Document Type
Technical Report
Publication Date
May 01, 1978
Accession Number
ADA062839

Entities

People

  • Egon Balas

Organizations

  • Carnegie Mellon University

Tags

Communities of Interest

  • Energy and Power Technologies

DTIC Thesaurus Topics

  • British Columbia
  • Coefficients
  • Cost Benefit Analysis
  • Costs
  • Economic Impact
  • Energy Conservation
  • Game Theory
  • Intensity
  • Middle East
  • Military Research
  • Operations Research
  • Petroleum
  • Probability
  • Probability Distributions
  • Production
  • Stockpiles
  • Universities

Readers

  • Game Theory.
  • Petroleum Engineering
  • Strategic Security Studies