Factors and Trends Analysis of International Crude Oil Price in 2022

Abstract

Due to the reopening and remarkable recovery of the global economy from the epidemic, as well as the increased mobility of people under higher vaccination rates, 2021 has been a year of significant recovery for both supply and demand of crude oil Since the shortage of natural gas has fuelled a widespread demand for crude oil as a substitute, the year 2022 may hold a lot of potential and meanwhile uncertainty for crude oil investors. This study focuses on both qualitative and quantitative analyses to review and summarize the past year's trend of international crude oil market prices, analyze the price influencing factors, as well as judging and forecasting the trend for the coming year. The qualitative analysis is mainly from the fundamental and non-fundamental point of view. In the quantitative analysis, the study mainly uses the ARDL-ECM model to do a regression analysis of the main influencing factors of the international crude oil market price. In addition, the paper uses a GVAR model to study the impact of global variables on individual country variables, i.e., a long-term scenario of relatively moderate oil prices, moderate increases in geopolitical risk, and relatively stable or decelerating financial liquidity growth. The study concludes that non-fundamental factors are negative for crude oil prices in 2022, but that the overall level of oil prices is relatively unchanged from last year.