Forty years of oil price fluctuations: why the price of oil may still surprise us

It has been forty years since the oil crisis of 1973/74. This crisis has been one of the defining economic events of the 1970s and has shaped how many economists think about oil price shocks. In recent years, a large lit
It has been forty years since the oil crisis of 1973/74. This crisis has been one of the defining economic events of the 1970s and has shaped how many economists think about oil price shocks. In recent years, a large literature on the economic determinants of oil price fluctuations has emerged. Drawing on this literature, we first provide an overview of the causes of all major oil price fluctuations between 1973 and 2014. We then discuss why oil price fluctuations remain difficult to predict, despite economists’ improved understanding of oil markets. Unexpected oil price fluctuations are commonly referred to as oil price shocks. We document that, in practice, consumers, policymakers, financial market participants and economists may have different oil price expectations, and that, what may be surprising to some, need not be equally surprising to others.
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Metadaten
Author:Christiane Baumeister, Lutz Kilian
URN:urn:nbn:de:hebis:30:3-392941
URL:http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2714319
DOI:http://dx.doi.org/10.2139/ssrn.2714319
Parent Title (English):Center for Financial Studies (Frankfurt am Main): CFS working paper series ; No. 525
Series (Serial Number):CFS working paper series (525)
Publisher:Center for Financial Studies
Place of publication:Frankfurt, M.
Document Type:Working Paper
Language:English
Date of Publication (online):2016/01/13
Date of first Publication:2016/01/13
Publishing Institution:Universitätsbibliothek Johann Christian Senckenberg
Release Date:2016/02/02
Tag:OPEC; heterogeneous price expectations; oil market; oil price shock; peak oil; unconventional oil
Pagenumber:40
HeBIS PPN:372417639
Institutes:Wirtschaftswissenschaften
Center for Financial Studies (CFS)
Dewey Decimal Classification:330 Wirtschaft
JEL-Classification:C53 Forecasting and Other Model Applications
Q43 Energy and the Macroeconomy
Sammlungen:Universitätspublikationen
Licence (German):License Logo Veröffentlichungsvertrag für Publikationen

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