The Effect Of Monetary Policy On Domestic Crude Oil Price

In recent years,international oil prices fell sharply in 2014,from $100 per barrel to $30.As a oil-glugger,China will face many challenges under the backgrounds of harp fluctuations in international oil prices.So slowing down energy price fluctuation is an important issue in the development of the national economy.In this background,this paper makes a concrete analysis of the following issues.First,based on the current crude oil pricing mechanism,this paper try to analysis the influence factors of China's crude oil prices,covering two commodities and currency markets,including domestic and international economic development status,industrial structure,energy structure,energy efficiency and cost of crude oil,oil exploration and production technology,proven reserves,surplus production capacity,OPEC's market behavior,geopolitics and war friction,natural disasters and other factors of supply and demand,and the dollar amount of currency supply,oil futures and other financial factors.Second,the influence mechanism of the price on the price of crude oil is analyzed through the general path of monetary policy affecting the overall price level in this paper.This paper believes that there are three paths of for monetary transmission:the first is a direct impact on the domestic price level through the money supply,including the price of crude oil;second is to change the macroeconomic environment through the impact of the supply of money on the actual output,thereby affecting the supply and demand of crude oil,and thus affect the price of crude oil;the third is the change in the money supply caused by changes in the exchange rate,because the domestic crude oil prices need to refer to the international,so exchange rate changes will directly affect the structural price of domestic crude oil converted into RMB.Third,this paper selects the appropriate variables and models,through empirical analysis of quantitative analysis of the impact of monetary policy on China's crude oil prices.This paper selects the monthly data from December 2001 to March 2016 as the empirical data base,and established the SVAR model between domestic oil prices and international crude oil prices,money supply,economic growth,domestic demand for crude oil,the domestic supply of crude oil through the SVAR model.Then the influence factors of domestic crude oil price are obtained,and the dynamic effects of international crude oil price change and money supply on domestic crude oil price are described by impulse response function.Subsequcntly,the variance analysis is used to analyze the contribution rate of each variable to the domestic crude oil price.According to the empirical results,the contribution rate of money supply to the domestic crude oil price is the highest among all factors,which provides the basis for the reform of energy prices and the choice of monetary policy.