Exogenous shocks intensify link between uncertainty and oil prices post-crisis.
The article examines how uncertainty in the stock market affects oil prices, especially before and after the 2008 financial crisis. The researchers used a special model to study how information moves between uncertainty and oil prices, both in terms of average changes and how much they vary. They found that there is a significant connection between stock market uncertainty and oil prices, and this connection changed after the crisis. They also discovered that unexpected events can make this connection stronger, affecting both the average and the variability of oil prices. Additionally, these unexpected events can directly impact oil prices.