The Effects of COVID-19 Spread on Oil Markets: The Case of the Top 10 Producing Countries

This paper attempts to investigate the effects of Coronavirus spread on oil companies. Coronavirus spread has been measured by cumulative cases, new cases, cumulative deaths and new deaths, on daily basis from March 15, 2020, to August 31, 2020. This has been applied to the top 10 oil companies in the world in terms of production. Using panel data analysis according ARDL technique, the study has investigated the short-run relationship between Coronavirus spread and abnormal return of oil companies. Besides, it has tested the long-run relationship and causality. Results support the short-run negative response of oil market to the spread of Coronavirus measured by cumulative and new cases and deaths, during the whole period. During March and April, oil markets seems to be sensitive to cumulative cases and deaths, while during May, it tends to be sensitive to new cases. Results do not support any negative effects during June, July and August.