The effects of political risk on oil prices and investment – some empirical findings
During the first trading week of the month, most major asset classes are trading lower, with old jumping on renewed inflation concerns and Saudi’s decision to extend its planned production cuts through the end of 2023. Russia has also reduced its exports by 300K bpd through the end of the year.
There is a well-developed body of empirical work done on the interface between political risk and the oil market, that has used our ICRG risk metrics for decades. Below are some samples for review.
1/ The impact of political risks and financial development on investments in the petroleum industry. (https://lnkd.in/g9_g8BSU)
2/ The effect of ‘resource nationalism’ – as a function of political risk – on the value of petroleum (crude oil and natural gas) reserves. (https://lnkd.in/gWqSBh4J)
3/ The impacts of OPEC’s political risk on the Brent crude oil prices, based on several Structural Vector Autoregression (SVAR) models. (https://lnkd.in/g5MtnQNF)
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Oct 05, 2023