The Impact of Political Tensions and Geopolitical Risks on Oil Prices in Unstable Environments

Jamel Saadaoui

No 2024.13, Working Papers from International Network for Economic Research - INFER

Abstract: This note explores the impact of geopolitical relationships between the US and China on the oil price. Using time-varying local projections, my analysis reveals that these dynamic effects are unstable over time. Indeed, these effects have been more observable since the global financial crisis, with China being increasingly perceived as a threat in the U.S. Instability is detected around the onset of the COVID-19 pandemic. During this period, geopolitical risks and political tensions influence oil price at different time horizons.

Keywords: Time-Varying Local Projections; China; Oil Price; Political Relations; Geopolitical Risks; Global Financial Crisis; COVID-19 pandemic (search for similar items in EconPapers)
JEL-codes: Q (search for similar items in EconPapers)
Pages: 16 pages
Date: 2024
New Economics Papers: this item is included in nep-cna, nep-ene, nep-mac and nep-rmg
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