External effects of the war in Ukraine: the impact on the price of oil in the short-term

Abstract

This paper analyses the short-term impact of the most relevant events of the war in the Ukraine on the price of oil. In order to determine the events to be studied, we propose a methodology based on a study of the news published in two reference newspapers in the markets: The Wall Street Journal and the Financial Times. From this selection, we use an event study model to detect the significance of the events. The main results obtained are: Events that affected daily oil prices were scarce and occurred during very specific phases of the conflict; West Texas intermediate price was more affected than Brent, even though the war took place in Europe; there is no noticeable lagged effect in the events, suggesting that the market assimilated the impact of relevant events very quickly