DROPS is a partial equilibrium model which allows the simulation of the global crude oil market with a quarter-yearly resolution for a desired time-period. The model simulates the global crude oil market under different scenarios and determines production volumes, imports and exports as well as prices. Multiple agents with different interests (e.g. OPEC and non-OPEC suppliers) can be modelled and market developments under different market structures (e.g. oligopolistic, perfect competition, cartel, etc.) can be simulated.
DROPS considers a realistic and detailed representation of the spatial structure of the crude oil market. Producers and consumers are mapped in a nodal network, where the respective nodes are connected by arcs representing pipelines or naval tanker routes. Infrastructure constraints such as pipeline capacities are taken into account. Producers are assigned piece-wise linear supply functions, with corresponding production capacities allocated to realistic cost levels.
DROPS allows the simulation of the global crude oil market under different market structure as-sumptions (e.g. perfectly competitive, oligopolistic, cartel).
Different scenarios regarding production cost development (e.g. shale vs. conventional cost development) or possible blockade of key transport routes (e.g. Strait of Hormuz) can be simulated.
DROPS can be used to analyse regional crude oil flows.
DROPS can be used to simulate crude oil price levels.