Terrorism and oil markets: A cross-sectional evaluation

This research focuses on the impact of terrorism on oil markets and investigates new risk factors including the distance between location of the attack and the closest oil facilities, the type of attack or organization perpetrating the event, and the size of the attack. We find that bombing events, events with large fatalities, and events with proximity to oil facilities result in a larger abnormal return of crude oil prices for terrorist attacks in the Middle East. These new important findings help us better understand the results of terrorism on crude oil prices and highlight the efficiency of oil markets.