The COVID-19 Pandemic and International Energy Trade: An Empirical Analysis Based on Gravity Model

This paper systematically examines the impact of the COVID-19 pandemic on international energy trade, addressing a critical gap in the literature where prior studies have predominantly focused on macroeconomic or sector-specific effects without isolating the pandemic's influence on bilateral energy trade flows. Using a gravity model augmented with nonparametric matching methods, we mitigate multicollinearity issues inherent in traditional fixed-effects approaches and quantify the asymmetric trade-suppressing effects of COVID-19. Our findings reveal that the pandemic led to a substantial contraction in global energy trade, with exporters experiencing greater adverse effects than importers, translating into an implicit increase in trade costs akin to large tariff hikes. Heterogeneity analyses further show that aging populations and regional disparities (e.g. Europe and North America) exacerbated these effects, while petroleum and gas trade suffered the most among energy products. These insights are crucial for policymakers seeking to design resilient energy trade policies in the face of future global crises.