Moody oil: What is driving the crude oil price?

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may AbstractThe unparalleled surge of the crude oil price after 2003 has triggered a heated scientific and public debate about its ultimate causes. Unexpected demand growth particularly from emerging economies appears to be the most prominently supported reason among academics. We study the price dynamics after 2003 in the global crude oil market using a structural VAR model. We account for structural breaks and approximate market expectations using a time series for media sentiment in order to contribute to the existing literature. We find that forward-looking demand activities rather than demand arising from current needs have played an important role for the run-up in the price of crude oil after 2003. We additionally find that emerging economies have not majorly contributed to the price surge.

Examining the dynamic effect of COVID-19 pandemic on dwindling oil prices using structural vector autoregressive model

“…Oil price affects the growth and development of oil-dependent economies and economic activities of many industrialized countries world over. A body of studies in the literature looked at the impact of oil price on macroeconomic variables such as GDP, interest rate, inflation rate, stock prices and food prices, oil supply shock, oil demand shock, and oil inventory, among others (Refs [ [1] , [2] , [3] , [4] , [5] , [6] , [7] , [8] , [9] ]). Recently, Gon, Chen and Lin [ 10 ] argue that the impact of nonmarket factors, such as epidemic disease, prevalence conflict and war, are more important in determination of oil prices.…”