Research on interregional oil cooperation-sanctions with evolutionary game

Abstract

Purpose – The game strategies differ when different regions participate in the oil game. Under what circumstances will different participants choose cooperation or sanction strategies? This is the core issue of this paper. Design/methodology/approach – Regarding the current and future game behavior between different regions in the oil trade, this paper constructs an evolutionary game model between two regions to explore the possibility of sanctions strategies between the two sides in different situations. Findings – The research finds: (1) When the benefits of in-depth cooperation between the two regions are greater, both sides tend to adopt cooperative strategies. (2) When the trade conflict losses between the two regions are smaller, both sides adopt sanctions strategies. (3) When a strong region trades with a weak region, if the former adopts a sanctions strategy, the net profits are greater than the benefits of in-depth cooperation between the two regions. If the latter adopts a sanctions strategy, the net profits are less than the trade conflict losses between the two regions. There will be the strong region adopting a sanctions strategy and the weak region adopting a non-sanctions strategy. At this time, the latter should reasonably balance the immediate and future interests and give up some current interests in exchange for in-depth cooperation between the two regions. Otherwise, it will fall into the situation of unilateral sanctions by the strong against the weak. Originality/value – There is no paper in the existing literature that uses the evolutionary game method to analyze the oil game problem between the two regions. This paper constructs a two-party evolutionary game model composed of crude oil importers and crude oil exporters and, based on this, analyzes the evolutionary stability between the two regions under sanctions and cooperation strategies, which enriches the energy research field.

Keywords

• Evolutionary game
• Cooperation-sanctions
• Interregional game
• Oil game