Oil Price Projection Model

Farid Muradzada () and Khazan Bakhshaliyev ()
Additional contact information
Farid Muradzada: Central Bank of Azerbaijan Republic
Khazan Bakhshaliyev: Central Bank of Azerbaijan Republic

No 2503, Working Papers from Central Bank of Azerbaijan Republic

Abstract: This study develops a forecasting framework for Brent crude oil prices based on the fundamental drivers of the global oil market, namely demand, supply, and market expectations. The estimation is conducted using quarterly time-series data covering the period 1994–2025 and employs a Vector Autoregressive (VAR) model. The results indicate that the proposed model demonstrates strong forecast performance under conditions of high oil price volatility. The forecasting error of the model is lower than that of benchmark models. Furthermore, the findings confirm that geopolitical tensions, regional conflicts, and uncertainty in global energy markets have a significant impact on oil price dynamics through oil futures prices.

Keywords: Brent crude oil price; oil price forecasting; VAR model (search for similar items in EconPapers)
JEL-codes: C53 Q43 Q47 (search for similar items in EconPapers)
Pages: 11 pages
Date: 2025-08-05
New Economics Papers: this item is included in nep-ets
References: Add references at CitEc
Citations:

Downloads: (external link)
https://uploads.cbar.az/assets/9cba9ab394c0c52aee619a822.pdf First version, 2025 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aze:wpaper:2503

Access Statistics for this paper

More papers in Working Papers from Central Bank of Azerbaijan Republic Contact information at EDIRC.
Bibliographic data for series maintained by Central Bank of Azerbaijan Republic ( this e-mail address is bad, please contact ).