Marc Gronwald

Oil prices, Exploration Activity and Future Oil Supply

One of Marc Gronwald's current research projects analyses the relationship between crude oil prices, oil field development and exploration investments, and crude oil supply. Extreme oil price episodes occur with considerable regularity, the most recent ones are dated 2008 and 2014. Research into the causes of these price movements clearly shows that they can be explained fundamentally: the oil price surge 2008 is caused by increased global demand; the oil price decline 2014 is a consequence of a slowing global economy and by larger than expected current and future crude oil production. In addition, very recent research has shown that exploration activities rather than crude oil production are directly affected by crude oil prices. A strong decline in global crude oil extraction activity is clearly measurable: global rig counts decreased considerably. This is very likely to affect future crude oil production. Thus, there seems to be a strong link between crude oil prices, exploration activity and future crude oil supply. Marc Gronwald's research project consists of two parts: first, using a probabilistic model of oil discoveries, he investigates how the observed decline in exploration activities will affect future crude oil supply. Second, he analyses the consequences the relationship between prices and supply has on optimal taxation of the fossil resource crude oil.

During his stay at CESifo, Mr Gronwald will also pursue work on another research project: "The Economics of Persuasion: Measuring Public Opinion using Sentiment Analysis", which will examine how information on natural disasters transmitted via mass media affect the perception of climate change.

Marc Gronwald's research lies in the areas of energy economics, environmental economics, resource economics, applied econometrics, public economics as well as the economics of Bitcoins.

Marc Gronwald is Senior Lecturer at the University of Aberdeen Business School and is affiliated with the Aberdeen Centre for Research in Energy Economics and Finance. Prior to this, he was a researcher at the Ifo Institute. He holds a Diploma in Economics from the University of Bielefeld and a PhD from the University of Hamburg. He is a Fellow of the CESifo Research Network and Research Associate of the ifo Center for Energy, Climate and Exhaustible Resources.