Inicio  /  Energies  /  Vol: 9 Núm: 12 Par: Decembe (2016)  /  Artículo
ARTÍCULO
TITULO

Analyzing Crude Oil Spot Price Dynamics versus Long Term Future Prices: A Wavelet Analysis Approach

Josué M. Polanco-Martínez and Luis M. Abadie    

Resumen

The West Texas Intermediate (WTI) spot price shows high volatility and in 2014 and 2015 when quoted prices declined sharply, long-term prices in future markets were less volatile. These prices are different and diverge depending on how they process fundamental and transitory factors. US tight oil production has been a major innovation with significant macroeconomic effects. In this paper we use WTI spot prices and long-term futures prices, the latter calculated as the expected value with a stochastic model calibrated with the futures quotes of each sample day. These long-term prices are the long-term equilibrium value under risk neutral measurement. In order to analyze potential time-scale relationships between spots and future, we perform a wavelet cross-correlation analysis using a novel wavelet graphical tool recently proposed. To check the direction of the causality, we apply non-linear causality tests to raw data and log returns as well as to the wavelet transform of the spot and futures prices. Our results show that in the spot and futures markets for the period 24 February 2006?2 April 2016 there is a bi-directional causality effect for most time scales (from intra-week to biannual). This suggests that spot and futures prices react simultaneously to new information.

 Artículos similares

       
 
Sergey Voronin and Jarmo Partanen    
A forecasting methodology for prediction of both normal prices and price spikes in the day-ahead energy market is proposed. The method is based on an iterative strategy implemented as a combination of two modules separately applied for normal price and p... ver más
Revista: Energies