Measuring the impact of COVID-19 surveillance variables over the international oil market

Coronavirus (COVID-19) has turned to be an alarm for the whole world both in terms of health and economics. It is striking the global economy and increasing the unpredictability of the financial market in several ways. Significantly, the pandemic spread stimulated the social distancing which led to the lockdown of the countries’ businesses, financial markets, and daily life events. International oil markets have accommodated the crude oil prices during the early COVID-19 period. However, after the first 50 days, Saudi Arabia has surged the market with oil, which caused a certain decrease in crude oil prices, internationally. Saudi Arabia is one of the biggest oil reserves in the world. International trade is based on oil reservoirs which in turn, have been significantly dislodged by the pandemic. Therefore, it is crucial to study the impact of COVID-19 on the international oil market. The purpose of this study is to investigate the short-term and long-term impact of COVID-19 on the international oil market. The daily crude oil price data is used to analyze the impact of daily price fluctuation over COVID-19 surveillance variables. The correlation between surveillance variables and international crude oil prices is calculated and analyzed. Consequently, the project will help in stabilizing the expected world economic crises and particularly will provide the implications for the policymakers in the oil market.

Public Expenditures Priorities between Human Development Requirements and Funding Constraints

Interest in the issue of public Expenditures (spending) priorities increases in times of financial and economic crisis, when restrictions on government funding grow, and financial markets stumble in providing financing channels with the necessary liquidity, as well as when paying attention to increasing the efficiency and productivity of public spending, by reducing the waste of public money and pursuing its allocation between different economic sectors to achieve the public benefit as much as possible and at the lowest possible cost. Among the discussions being raised in this regard is where the priority lies in spending is on sectors that support human development such as (education, health and public services), or the priority of spending on other sectors (which may hinder human development and delay the development of states and civil societies) such as military sectors, armaments, military industries and related sectors. Because each side has its arguments and evidence of modern economic and human experiences, it is difficult to resolve the controversy in a certain direction and ignore the opinion of the second party, but what concerns us is the situation of our country and our society and the economic and social pressures and renewed threats from time to time, and what is the most objective and credible reading of the authors of the philosophy of the Iraqi economy, and its emerging priorities developed after 2003, through the trends of the federal budget in this country. Given the financial crisis that is ravaging the global economy as a result of the Corona pandemic and the great isolation measures Great Lockdown and the repercussions of this crisis on the Iraqi economy as a result of the collapse of the world oil markets, so discussions are escalating in the field of rationalization and efficiency of government public spending, and because the general budget depends on the general revenues on oil revenues by more than 90% in most years after 2003, so an external shock or collapse in the oil market affects the revenues of the general budget, and therefore there is a situation The uncertainty of budget planners and implementers in collecting the revenues required to cover the public expenditure side, and the most important items of governing public expenditure, namely employee compensation, support for the poor and others.

The Oil Futures and Options Markets in 2020: The “Message from Markets”

This paper considers the response of the equity and oil markets to the onset of crisis conditions after February 15, 2020. Based on derivative markets for equities and WTI (West Texas Intermediate) crude-oil futures contracts, implied equity and oil volatilities quantify the depth of the crisis and contrast it with the previous ones. The estimated Black [(1976) Journal of Financial Economics, 3, 167–179] vol skew and Merton [(1976) Journal of Financial Economics, 3, 125–144] option model parameters are able to discern between demand- and supply-side facets. The time when the futures curve is in contango identifies the beginning and, to date, conclusion of the crisis. Using the CAPM, co-movement of oil and equity prices permits computing forecasts of spot oil prices. In considering these events, we recognize the essential role of prices in financial markets: They are conveyors of information, the “Message from Markets,” in which financial theory proves useful, practical and applicable.

The Dependence and Risk Spillover Between Energy Market and BRICS Stock Markets: A Copula-MGARCH Model Approach

The article examines the dynamic dependence structure and risk spillover between the future market of energy commodities and Brazil, Russia, India, China and South Africa (BRICS) stock markets for different market conditions. The study used copula-based multivariate GARCH model, or in short C-MGARCH model, to explore the conditional correlation by multivariate generalized autoregressive conditional heteroskedastic (MGARCH) and the remaining dependence by different copula models. Our results provide significant positive dynamic dependency among crude oil markets (natural gas market) and BRICS stock markets. We then explore the financial implications of volatility spillovers regarding portfolio risk management through an analysis of risk spillovers from energy market to BRICS countries using the value at Risk (VaR), conditional value at risk (CVaR) and delta CVaR. Our findings support the existence of significant risk spillover between crude oil markets (natural gas market) and BRICS stock markets. The presence of volatility spillover among oil prices, natural gas prices and BRICS stock market implies that oil market information (natural gas market information) enhances the volatility forecast in stock markets. Consequently, investors must take oil markets and natural gas markets into account at the time of financial portfolios structuring and in improving their hedging strategies.