{
  "title": "OPEC and the Oil Market",
  "publication": "IMF Working Papers, September 16, 2022",
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  "summary": "This paper studies the historical importance of OPEC for oil price fluctuations. An event-study approach is used to identify the effects of OPEC announcements on oil price fluctuations. Results show that price volatility is higher than typical around OPEC meetings.",
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    {
      "heading": "Overview and methodology",
      "content": "- Paper studies the historical importance of OPEC for oil price fluctuations.\n- Uses an event-study approach to identify the effects of OPEC announcements on oil price fluctuations.\n- Employs an ordered multinomial logit framework to identify factors that explain OPEC's decisions to cut, maintain, or boost members' oil production and to predict OPEC meeting outcomes."
    },
    {
      "heading": "Key findings",
      "content": "- Price volatility is higher than typical around OPEC meetings.\n- Members' compliance, used as a proxy for credibility, has strongly fluctuated over time.\n- The ordered multinomial logit framework successfully predicts OPEC meeting outcomes 66 percent of the time, between 1989 and 2019.\n- Cyclical oil price fluctuations (as opposed to persistent shifts in levels) drive OPEC’s decisions, suggesting OPEC's objective is to stabilize the oil price rather than countering fundamental shifts in demand and supply.\n- Low OPEC’s market share reduces the probability of a production cut.\n- The transparency of OPEC's statements has modestly improved between 2002 and 2019."
    },
    {
      "heading": "Subjects and keywords",
      "content": "- Subjects: Commodities, Commodity price fluctuations, National accounts, Oil, Oil consumption, Oil prices, Oil production, Prices, Production\n- Keywords: Commodity price fluctuations; Credibility; Global; Oil; Oil consumption; Oil Price; Oil prices; Oil production; OPEC announcement; OPEC meeting; OPEC Meetings; OPEC+; OPECS decision; OPECS objective; OPECS statement; Text Analysis\n\n---\n\n Content in this bundle\n\n- Working Paper\n  - Working Paper (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Working Paper (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2022/09/15/opec-and-the-oil-market-523393"
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    "Authors: Andrea Pescatori, Yousef F. Nazer",
    "Published: September 16, 2022",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9798400219788.001",
    "Paper studies the historical importance of OPEC for oil price fluctuations.",
    "Uses an event-study approach to identify the effects of OPEC announcements on oil price fluctuations.",
    "Employs an ordered multinomial logit framework to identify factors that explain OPEC's decisions to cut, maintain, or boost members' oil production and to predict OPEC meeting outcomes.",
    "Price volatility is higher than typical around OPEC meetings.",
    "Members' compliance, used as a proxy for credibility, has strongly fluctuated over time.",
    "The ordered multinomial logit framework successfully predicts OPEC meeting outcomes 66 percent of the time, between 1989 and 2019.",
    "Cyclical oil price fluctuations (as opposed to persistent shifts in levels) drive OPEC’s decisions, suggesting OPEC's objective is to stabilize the oil price rather than countering fundamental shifts in demand and supply.",
    "Low OPEC’s market share reduces the probability of a production cut.",
    "The transparency of OPEC's statements has modestly improved between 2002 and 2019.",
    "Subjects: Commodities, Commodity price fluctuations, National accounts, Oil, Oil consumption, Oil prices, Oil production, Prices, Production",
    "Keywords: Commodity price fluctuations; Credibility; Global; Oil; Oil consumption; Oil Price; Oil prices; Oil production; OPEC announcement; OPEC meeting; OPEC Meetings; OPEC+; OPECS decision; OPECS objective; OPECS statement; Text Analysis",
    "**Working Paper**"
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