Energy Trade—The Backbone of Sustainable Energy Security

Part of the Lecture Notes in Energy book series (LNEN, volume 68)


This chapter proposes that energy trade is the backbone of sustainable energy security. It argues that energy trade ensures availability of energy, lowers cost, has environmental advantages, supports economic activity, promotes energy equity and is associated with higher efficiency. International trade of oil, natural gas and coal has grown over the last few decades and is forecasted to grow further. The importance of maritime energy trade in the overall energy trade is discussed. The role of energy markets in energy trading is evaluated, and the nature of energy trading on energy commodities exchanges and power exchanges is explained. The mechanisms by which energy trade is undertaken such as long-term contracts and spot buys are presented. Fixing of energy prices, mechanisms for hedging the price of energy such as forwards and futures contract, swaps and options are briefly introduced. Other enablers of energy trade such as political and economic stability and international cooperation which promote SES are also discussed.


Energy trade Energy markets Energy exchange Spot price Long-term contract 


  1. BP (2017) BP Statistical Review of World Energy 2017. British Petroleum, LondonGoogle Scholar
  2. Buhaug Ø, Corbett JJ, Endresen Ø, Eyring V, Faber J, Hanayama S, Lee DS, Lee D, Lindstad H, Markowska AZ, Mjelde A, Nelissen D, Nilsen J, Pålsson C, Winebrake JJ, Wu W, Yoshida K (2009) Second IMO GHG study 2009. IMO, LondonGoogle Scholar
  3. Cho J-W, Ratna RS, Leung VSM (2015) Prospects for enhancing energy security in Asia and the Pacific through regional trade. Bangkok, ARTNeT.
  4. Davis SC, Williams SE, Boundy RG (2016) Transportation energy data bookGoogle Scholar
  5. EIA (2018) US Energy Information Administration. Table definitions, sources, and explanatory notes [online]. Available at Accessed 13 Jan 2018
  6. European Energy Exchange (2017) EEX homepage [online]. Available at Accessed 12 Jan 2018
  7. Hall C, Lambert J, Balogh S (2014) EROI of different fuels and the implications for society. Energy Policy 64:141–152CrossRefGoogle Scholar
  8. HMS Bergbau AG (2017) World coal trade—HMS Bergbau AG [online]. Available at Accessed 10 Jan 2018
  9. Intercontinental Exchange (2018) ICE OTC energy | transparent over the counter energy market [online]. Available at Accessed 7 Jan 2018
  10. International Energy Agency (IEA), The World Bank (2017) Sustainable energy for all 2017—progress toward sustainable energy (summary). World Bank, Washington, DC. License: Creative Commons Attribution CC BY 3.0 IGOGoogle Scholar
  11. Knoema (2018) Cost of oil production by country— [online] Knoema. Available at Accessed 2 Jan 2018
  12. Leal-Arcas R (2015) How governing international trade in energy can enhance EU energy security. Renew Energy Law Policy Rev 6(3):202–219. Available at SSRN:
  13. Leal-Arcas R, Grasso C, Ríos JA (2016) Energy security, trade and the EU: regional and international perspectives. Scholar
  14. Lin W, Chen B, Xie L, Pan H (2015) Estimating energy consumption of transport modes in China using DEA. Sustainability 7(4):4225–4239CrossRefGoogle Scholar
  15. Mielke E, Anadon LD, Narayanamurti V (2010) Water consumption of energy resource extraction, processing, and conversion. Energy technology innovation policy discussion paper no. 2010- 15, Belfer Center for Science and International Affairs, Harvard Kennedy School, Harvard University, U.S. Available at
  16. Nasdaq (2018) Markets overview [online]. Available at Accessed 18 Mar 2018
  17. Qi T (2011) The implications of reshaping energy trade discipline on China’s energy security. Energy Procedia 5:562–566CrossRefGoogle Scholar
  18. S&P Global Platts (2018) Spot LNG trading makes up 18% of total LNG volumes in 2016: GIIGNL—natural gas | Platts news article & story [online]. Available at Accessed 11 Jan 2018
  19. The Economist (2011) The price of fear [online]. Available at Accessed 10 Jan 2018
  20. The Wall Street Journal (2018) Barrel breakdown [online]. Available at Accessed 18 Jan 2018
  21. World Bank Open Data (2017) The World Bank Group. Retrieved from

Copyright information

© Springer Nature Singapore Pte Ltd. 2019

Authors and Affiliations

  1. 1.Institute for Environmental Sciences (ISE)University of GenevaGenevaSwitzerland

Personalised recommendations