The Federal Reserve Bank of New York today released a new weekly report that examines fluctuations in oil prices. Using a statistical model and a large number of financial variables, the Oil Price Dynamics Report provides analysis on the demand and supply factors influencing observed changes in oil prices. The report breaks down cumulative percentage differences since the beginning of the previous quarter; it also provides a longer-term view of oil price movements.
The report will help determine whether oil price changes reflect demand shocks or supply shocks, since the two types of shocks have very different implications for the U.S. economic outlook.
Today’s launch of the Oil Price Dynamics Report is accompanied by a blog post on Liberty Street Economics.
The current report includes the following highlights:
- As demand expectations continued to improve and supply conditions tightened further, oil prices rose again in the past week, returning to the same levels seen at the start of October 2015.
- These developments follow the sustained oil price weakness over 2015:Q4, which was predominantly supply-driven.
- Oil price declines in Q2 and Q3 of last year were influenced more heavily by global demand expectations—a pattern at odds with the supply-driven declines seen in 2012-14.
The Oil Price Dynamics Report will be released each Monday at 3:00 p.m., except during the FOMC blackout period. For Mondays that occur on federal holidays, the Report will be released at 3:00 p.m. the next day.