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Oil Price Movements (oil + price_movement)

Distribution by Scientific Domains
Business, Economics, Finance and Accounting100%

Selected Abstracts

Oil price movements and globalisation: is there a Connection?

OPEC ENERGY REVIEW, Issue 3 2002
Robert Looney
There has been considerable speculation over the years concerning the cost of large oil price movements ("shocks") to consuming countries. For the advanced industrial countries, the conventional wisdom appears to be that, because these economies are becoming more service,oriented, less energy is needed per unit of gross domestic product (GDP) and hence a lessening of the economic costs associated with increased oil prices. On the other hand, because many newly industrialised or catching,up countries are entering a phase of energy,intensive industrialisation, the same oil shocks are placing an increasing burden on these economies. One can easily argue, however, that industrialisation is only one facet of economic change taking place in the world economy. Conceivably, the rapid pace of increased globalisation may significantly modify these patterns. To test this proposition, an operational definition of globalisation is developed and shown to be positively associated with the strength of oil price shocks. The main finding of the study is that increased globalisation appears to be strengthening the impact of oil price shocks in the advanced industrial countries, but to a much lesser extent in the newly industrialising countries. [source]

Forecasting oil price movements: Exploiting the information in the futures market

THE JOURNAL OF FUTURES MARKETS, Issue 1 2008
Andrea Coppola
Relying on the cost of carry model, the long-run relationship between spot and futures prices is investigated and the information implied in these cointegrating relationships is used to forecast out of sample oil spot and futures price movements. To forecast oil price movements, a vector error correction model (VECM) is employed, where the deviations from the long-run relationships between spot and futures prices constitute the equilibrium error. To evaluate forecasting performance, the random walk model (RWM) is used as a benchmark. It was found that (a) in-sample, the information in the futures market can explain a sizable portion of oil price movements; and (b) out-of-sample, the VECM outperforms the RWM in forecasting price movements of 1-month futures contracts. © 2008 Wiley Periodicals, Inc. Jrl Fut Mark 28:34,56, 2008 [source]