Covid-۱۹ and Energy Trade Integration in GCC

Since late ۲۰۱۹, the outbreak of Coronavirus has disrupted, transformed and changed many aspects of the global economy. Especially, enery market experienced radical changes in the past two years. In ۲۰۲۰, global oil and gas market experienced oversupply to unpresedented level. ۲۰۲۱, many countries went through supply crunch of energy commodity and sharp rise of energy demand. One of the most important and influential aspects of the global economy is the energy (especially oil and gas) trade which has experienced challenges in the last two years due to the effects of Covid-۱۹. The countries of the member states of the GCC (Gulf Cooperation Countries) - as the core of the world's oil and gas supply- have not been spared from these challenges. Along with the changes in international trade the internal energy demand is strongly influenced by Covid-۱۹ and the way the GCC adopt its own energy busket for more sustainable development makes particular interest. The purpose of this study is to investigate the changes in oil and gas trade of the GCC countries with their major energy trade partners. Considering the integration of energy trade, meaning any significant continuous increase in energy trade, the findings of this study show that this concept is in the form of U-shaped in the energy trade relations of the GCC - energy importers. This means that due to the initial sharp decline in global energy demand (due to disruptions in production and declining consumer demand), disintegration of energy trade happened and then with the adaptation of countries to the Covid-۱۹ conditions and increasing global energy demand, integration of energy trade has been formed, which in the near future (post Covid-era) will form more intensely.

Keywords:

Covid-۱۹ , economic recovery , energy intensity , energy trade integration , fossil fuels , GCC