How do oil producers respond to giant oil field discoveries?

摘要

The classical Hotelling model predicts that the optimal extraction level rises immediately after an unexpected resource discovery, whereas, in reality, there are substantial adjustment costs in petroleum production and an average lag of several years between a discovery and the start of production. Using a large panel of country-level production data and a difference-in-differences identification approach, I show that domestic production levels respond before a newly found oil field comes on line and that this increase is driven by non-OPEC producers, consistent with different responses of OPEC and non-OPEC drilling activity. Offshore fields and exceptionally large "super-" or "mega-giant" fields are also more likely to raise country-level production. Given that domestic petroleum consumption rises by less in response to a discovery, at least part of the increase in production seems to go into (net) oil exports. (C) 2018 Elsevier B.V. All rights reserved.