Research of European energy economy based on SVAR model

This paper examines the impact of crude oil price shocks on the European Union's economy, particularly in the context of the 2022. The study employs a Structural Vector Autoregression (SVAR) model to decompose demand and supply shocks in the European crude oil market from 2003 to 2022. The results indicate that different types of shocks—precautionary demand, oil supply disruption, and aggregate demand—have distinct effects on oil prices. The analysis reveals that the price fluctuations following Russia's invasion were primarily driven by oil-specific demand and supply shocks, while aggregate demand shocks had a relatively minor impact. The paper contributes to the understanding of how oil price dynamics, particularly during geopolitical crises, influence macroeconomic performance in the EU.