New kid on the block? China vs the US in world oil markets

Jamie Cross, Bao H. Nguyen and Bo Zhang ()

CAMA Working Papers from Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University

Abstract: China has recently overtaken the US to become the world largest importer of crude oil. In light of this fact, we formally compare contributions of demand shocks from China, the US and the rest of the world. We find that China’s influence on the real price of oil has increased over the past two decades and surpassed that of the US. Despite this result, oil prices are more sensitive to demand shocks from the US than China. Finally, we document that demand shocks from China alone were too small to have caused the mid 2003-2008 price surge. Instead, oil specific demand shocks are found to be the major determinant of the real oil price during this period.

Keywords: China; US; Oil markets (search for similar items in EconPapers)
JEL-codes: C32 E32 Q4 (search for similar items in EconPapers)
Pages: 12 pages
Date: 2019-05
New Economics Papers: this item is included in nep-cna, nep-ene and nep-mac
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Working Paper: New Kid on the Block? China vs the US in World Oil Markets (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:een:camaaa:2019-33

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