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The Impact of U.S. Supply Shocks on the Global Oil Price

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  • Thomas S. Gundersen

Abstract

I examine the role of the U.S. shale oil boom in driving global oil prices. Using a structural vector autoregressive (SVAR) model that identifies separate oil supply shocks for the U.S. and OPEC, I find that U.S. supply shocks can account for up to 13% of the oil price variation over the 2003-2015 period. This is considerably more than what has been found in other studies. Moreover, while U.S. oil production has increased substantially since 2010, U.S. oil supply shocks first started to contribute negatively to oil prices beginning in late 2013. This mismatch implies a temporary friction in the transmission of U.S. supply shocks to the rest of the world likely caused by logistical and technological challenges observed in the downstream supply chain.

Suggested Citation

  • Thomas S. Gundersen, 2020. "The Impact of U.S. Supply Shocks on the Global Oil Price," The Energy Journal, , vol. 41(1), pages 151-174, January.
    • Handle: RePEc:sae:enejou:v:41:y:2020:i:1:p:151-174
    DOI: 10.5547/01956574.41.1.tgun
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    Cited by:

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    3. T. Bermpei & A. Triantafyllou, 2026. "The impact of supply and demand driven oil price uncertainty on the cost of bank loans," Post-Print hal-05535567, HAL.
    4. Corey Williams, 2025. "Political Uncertainty Cycles and the Impact of Oil Shocks on Supply Chain Pressures," Economies, MDPI, vol. 13(6), pages 1-16, June.
    5. Ioannis Arampatzidis, 2026. "Shale oil revolution, the global oil market and the US economy," Empirical Economics, Springer, vol. 70(1), pages 1-24, January.

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