The full text of this article
The dynamic relationship between tanker freight rates and crude oil production: evidence from causality analysis
by Philipp Lauenstein
International Journal of Trade and Global Markets (IJTGM), Vol. 10, No. 4, 2017
Abstract: This paper studies the dynamics between tanker freight rate and crude oil production levels. Making use of the Toda and Yamamoto (1995) procedure, it is tested for the (non-)existence of Granger (1969) causal relationships between the two variables. Over the sample period from 1998 to 2014, the results suggest that past information of crude oil production levels uni-directionally helps to predict current tanker freight rate levels. This holds both for aggregated global data and for specific trading routes. Moreover, making use of breakpoint analysis, it is found that this causal relationship is only valid until 2009, since when the global tanker shipping market suffers strongly from excess tonnage capacity. During periods of low earnings in the tanker market, freight rate levels are not impacted by changes in crude oil production. At the practical level, the findings imply that, depending on the state of the freight market, ship owners and operators may improve chartering decision-making by monitoring physical crude oil production volumes.
is only available to individual subscribers or to users at subscribing institutions.
Go to Inderscience Online Journals
to access the full text.
Pay per view:
If you are not a subscriber and you just want to read the full contents of this article, buy online access here.
Complimentary Subscribers, Editors or Members of the Editorial Board of the International Journal of Trade and Global Markets (IJTGM):
Login with your Inderscience username and password:
Want to subscribe?
A subscription gives you complete access to all articles in the current issue, as well as to all articles in the previous three years (where applicable). See our Orders page to subscribe.
If you still need assistance, please email firstname.lastname@example.org