The dynamic interaction between oil prices and freight rates in maritime trade: a bootstrap rolling window approach

Abstract The study uses the rolling window technique to assess the causal link between the oil price (OP) and the Baltic Dry Index (BDI) from 2000 to 2022. The results support the competitive market hypothesis, suggesting that OP and BDI have a significant relationship. The results indicate that knowledge of potential changes in OP can help to lessen the risk of abrupt changes in BDI. Similarly, information on various sources of OP changes can assist the shipping industry in taking practical measures to minimize the impact of shocks. The stability of global maritime trade is vital to the global economy because its massive shares and abnormal behaviour can negatively affect the oil market and international trade. This helps ensure timely measures are taken to avoid unforeseen events and maintain stability. Therefore, the study is a valuable contribution to the shipping industry stakeholders in terms of information about the specific period with underlying factors.