## An Oil and Gas Model

_IMF Working Papers, June 1, 2007_

## Source details

**Canonical URL:** [An Oil and Gas Model](https://www.imf.org/en/publications/wp/issues/2016/12/31/an-oil-and-gas-model-21016)

## Other formats

- [Markdown version](/en/publications/wp/issues/2016/12/31/an-oil-and-gas-model-21016/index.md)
- [Structured JSON version](/en/publications/wp/issues/2016/12/31/an-oil-and-gas-model-21016/index.json)
- [Bundle manifest](/en/publications/wp/issues/2016/12/31/an-oil-and-gas-model-21016/bundle-manifest.json)

## Bibliographic details
- Authors: Noureddine Krichene
- Published: June 1, 2007
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451866995.001

---

### Summary
- This paper formulated a short-run model, with an explicit role for monetary policy, for analyzing world oil and gas markets.
- The model described carefully the parameters of these markets and their vulnerability to business cycles.
- Being simultaneous and incorporating interest and exchange rates, the model could be useful in short-term forecasting of oil and gas outputs and prices under policy scenarios.
- Author: Noureddine Krichene
- Date: June 1, 2007

### Key empirical findings and model estimates
- Short-run demand for oil and gas was price-inelastic.
- Short-run demand for oil and gas was relatively income-elastic.
- Short-run demand was influenced by interest and exchange rates.
- Short-run supply was price-inelastic.
- Short-run price inelasticity could be a source for high volatility in oil and gas prices.
- Short-run price inelasticity could confer to producers a temporary market power.

### Model features and analytical uses
- The model is short-run and simultaneous.
- It includes an explicit role for monetary policy.
- It incorporates interest rates and exchange rates as influences on demand.
- Potential use: short-term forecasting of oil and gas outputs and prices under policy scenarios.

### Subject headings and keywords
- Subject: Fuel prices, Natural gas sector, Oil, Oil prices, Price elasticity
- Keywords: demand price, demand shock, WP

---

## Content in this bundle

- **An Oil and Gas Model; Noureddine Krichene; IMF Working Paper 07/135; June 1, 2007**
  - [An Oil and Gas Model; Noureddine Krichene; IMF Working Paper 07/135; June 1, 2007 (Markdown version)](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2007/_wp07135.pdf.md){rel="alternate" type="text/markdown"}
  - [An Oil and Gas Model; Noureddine Krichene; IMF Working Paper 07/135; June 1, 2007 (PDF)](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2007/_wp07135.pdf){rel="external" type="application/pdf"}

---

_Source: https://www.imf.org/en/publications/wp/issues/2016/12/31/an-oil-and-gas-model-21016_