BUSINESS CYCLE AND GAS PRICES
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Date
2023
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Publisher
Nazarbayev University Graduate School of Business
Abstract
The theory of storage is essential for the prediction of spot and forward price
changes. The research analyzes the theory through a stable energy source - natural
gas. The hypothesis of the theory of storage implies that during low inventory, the
current price is more volatile than future prices, while during high inventory
periods, prices change equally. Moreover, spot prices greatly affect futures during
high inventory periods. The theory also observes the negative relationship between
inventory and the business cycle. This means that during business cycle peaks,
inventory is low which causes an increase in prices. Current research observed the
direct and indirect test of inventory to support the storage theory. The results for
natural gas in the analysis of both approaches of inventory support the theory, while
the business cycle has a minor effect on the prediction of prices..
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Type of access: Gated
Citation
Kabkenova, Sh. (2023). Business Cycle And Gas Prices. Nazarbayev University Graduate School of Business