Studies from Central Bank Corporation Reveal New Findings on Investment (The Economic Implications of Oil Supply Uncertainty): Investment

2025 MAY 16 (NewsRx) -- By a News Reporter-Staff News Editor at Energy Daily News -- Investigators discuss new findings in Investment. According to news originating from Dublin, Ireland, by NewsRx editors, the research stated, “By exploiting the stochastic volatility in oil production, we identify a novel source of instability in the global oil market: oil supply uncertainty. Our measure provides additional insights to standard measures in the literature, such as the geopolitical risk index and oil supply surprises.”

Our news journalists obtained a quote from the research from Central Bank Corporation, “In particular, we demonstrate that unexpected increases in oil supply uncertainty lead to higher real oil prices and a drop in inventories. As such, our mechanism works through the speculative component in the global oil market, resembling the effects of a shortfall in oil supply. However, in contrast with a negative oil supply shock, heightened oil supply uncertainty yields a highly transitory decline in oil production.”

According to the news editors, the research concluded: “Furthermore, evidence from a sectoral analysis of the U.S. economy indicates that the effect on economic activity is more pronounced in the durable goods sector, driven by delayed investment and spending decisions, while the most pronounced effects are observed in energy-sensitive sectors.”

This research has been peer-reviewed.

For more information on this research see: The Economic Implications of Oil Supply Uncertainty. Energy Economics, 2025;145. Energy Economics can be contacted at: Elsevier, Radarweg 29, 1043 Nx Amsterdam, Netherlands. (Elsevier - www.elsevier.com; Energy Economics - http://www.journals.elsevier.com/energy-economics/)

The news correspondents report that additional information may be obtained from Gabriel Arce-Alfaro, Central Bank Corporation, Dublin, Ireland.

The direct object identifier (DOI) for that additional information is: https://doi.org/10.1016/j.eneco.2025.108425. This DOI is a link to an online electronic document that is either free or for purchase, and can be your direct source for a journal article and its citation.

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