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The impact of crude oil price on the tanker market

Citation

Shi, W and Yang, Z and Li, KX, The impact of crude oil price on the tanker market, Maritime Policy and Management, 40, (4) pp. 309-322. ISSN 0308-8839 (2013) [Refereed Article]

Copyright Statement

Copyright 2013 Taylor & Francis

DOI: doi:10.1080/03088839.2013.777981

Abstract

The demand for crude oil transport services is a derived demand, which is dependent on international trade of crude oil and crude oil carriers transport crude oil from producer regions to consumer regions. The purpose of this study is to investigate the relationship between fluctuations in oil prices and the freight market (hereinafter referred to as ‘the tanker market’) using a structural vector autoregressive (SVAR) model. Referring to Kilian and Park's method of structural decomposition of fluctuations in crude oil prices, crude oil price shocks are classified into crude oil supply shocks and crude oil non-supply shocks in this study. Also, the response of the tanker market to different shocks is examined using the impulse response analysis. The empirical results provide evidence that crude oil supply shocks have significant effects on the contemporaneous tanker market. However, the impact of crude oil non-supply shocks is insignificant. In addition, the accumulated responses of the tanker market to crude oil non-supply shocks and crude oil supply shocks are positive but they are far lower than other shocks to the tanker market. Empirical results from this research are consistent with the fact of high crude oil tanker freight rates but low profits for tanker operators.

Item Details

Item Type:Refereed Article
Keywords:Crude oil supply shocks; crude oil non-supply shocks; impulse response analysis
Research Division:Economics
Research Group:Applied Economics
Research Field:Transport Economics
Objective Division:Defence
Objective Group:Defence
Objective Field:Logistics
Author:Shi, W (Dr Wenming Shi)
ID Code:112460
Year Published:2013
Web of Science® Times Cited:3
Deposited By:Maritime and Logistics Management
Deposited On:2016-11-11
Last Modified:2017-04-10
Downloads:0

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