Energy Prices and COVID-Immunity: The Case of Crude Oil and Natural Gas Prices in the US and Japan

The COVID-19 pandemic storm has struck the world economies and energy markets with extreme strength. The goal of our study is to assess how the pandemic has influenced oil and gas prices, using energy market reactions in the United States and Japan. To investigate the impact of the COVID-19 cases on...

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Bibliographic Details
Published inEnergies (Basel) Vol. 13; no. 23; p. 6300
Main Authors Nyga-Łukaszewska, Honorata, Aruga, Kentaka
Format Journal Article
LanguageEnglish
Published Basel MDPI AG 01.12.2020
Subjects
ARDL
Calibration
Coronaviruses
COVID-19
Crude oil
Economic conditions
Economic growth
Energy
Energy industry
energy shock
Natural gas
Oil
Unemployment
United States > US
Japan
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Summary:The COVID-19 pandemic storm has struck the world economies and energy markets with extreme strength. The goal of our study is to assess how the pandemic has influenced oil and gas prices, using energy market reactions in the United States and Japan. To investigate the impact of the COVID-19 cases on the crude oil and natural gas markets, we applied the Auto-Regressive Distributive Lag (ARDL) approach to the number of the US and Japanese COVID-19 cases and energy prices. Our study period is from 21 January 2020 to 2 June 2020, and uses the latest data available at the time of model calibration and captures the so-called “first pandemic wave”. In the US, the COVID-19 pandemic had a statistically negative impact on the crude oil price while it positively affected the gas price. In Japan, this negative impact was only apparent in the crude oil market with a two-day lag. Possible explanations of the results may include differences in pandemic development in the US and Japan, and the diverse roles both countries have in energy markets.
ISSN:1996-1073
1996-1073
DOI:10.3390/en13236300