Oil Prices Shocks. Causes of oil price shocks in the world. (Essay Sample)

Oil prices shocks
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Oil prices have a significant effect on any economy doing high production and distribution of oil. The Gulf area possesses a considerable percentage of the world’s total oil production, and sometimes the volatility of oil prices affects their financial markets. The analysis is this paper aims to review the different methods used to measure the correlation between the volatility of oil prices and financial markets. The debate whether there is a positive or negative correlation between these two variables (oil price volatility and financial markets), stirs up the discussion on various reasons as to why this comparison is valid. Oil prices usually yield mixed results during analysis except for only three industries showing a significant and positive effect. The volatility of oil prices carries more influence in the financial markets than oil prices.