Risk perception and oil and gasoline markets under COVID-19
Behzod B. Ahundjanov,
Sherzod Akhundjanov () and
Botir B. Okhunjanov
Journal of Economics and Business, 2021, vol. 115, issue C
The novel coronavirus (COVID-19) exposed individuals to a great uncertainty about its health and economic ramifications, especially in the early days and weeks of the outbreak. This study documents oil and gasoline market implications of individuals’ behavior upon such uncertainty by analyzing the relationship between Google search queries related to COVID-19—information search that reflects one's level of concern about the subject (risk perception)—and the performance of oil and gasoline markets during the pandemic. The empirical analysis based on daily data and a structural vector autoregressive model reveals that a unit increase in the popularity of COVID-19 related global search queries, after controlling for COVID-19 cases, results in 0.083% and 0.104% of a cumulative decline in Dow Jones US Oil & Gas Total index and New York Harbor Conventional Gasoline Regular spot price, respectively, after one day, 0.189% and 0.234% of a cumulative decline after one week, and 0.191% and 0.237% of a cumulative decline after two weeks. The reaction of Brent and West Texas Intermediate crude oil prices to the spike in COVID-19 related online searches is found to be statistically insignificant, which can be explained by oil price pass-through into gasoline spot price.
Keywords: Coronavirus; Google Trends; Risk perception; Oil prices; Gasoline prices; Energy markets (search for similar items in EconPapers)
JEL-codes: G15 I10 Q41 Q43 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
Full text for ScienceDirect subscribers only
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eee:jebusi:v:115:y:2021:i:c:s0148619520304239
Access Statistics for this article
Journal of Economics and Business is currently edited by Emanuele Bajo and Moritz Ritter
More articles in Journal of Economics and Business from Elsevier
Bibliographic data for series maintained by Catherine Liu ().