English for Academic and Professional Purposes

QA1: Critique of an Editorial Cartoon

Name Kaye Annzelle B. Salamat
Section H12-03
Attempt No. 1

Why do the fuels linger on having a high price? The fuels are having high prices
because it indicates that the higher oil prices are towards the developing global
economic recovery. The ongoing turmoil in the Middle East and strong demand growth
brought on by the global economy appear to be supporting the rise in oil prices.
According to the Asian Development Outlook 2004 (ADB 2004), the project oil prices
stayed within $28-30 per barrel in 2004, beyond the norm over the past several years,
but dipped to $24–26 in 2005. Oil prices, however, have already surpassed that mark
and are anticipated to remain high for some time. Due to its substantial reliance on oil
imports, Asia continues to be particularly susceptible to an oil shock. While just 10% of
the world's crude oil is produced in Asia, the continent uses around 24% of it.
Additionally, the price of oil imports is rising across Asia, particularly, Asia and The
People’s Choice Chinese Republic. Energy monetary policies were recurrently forecast
to raise monetary policy and hinder GDP growth. Regarding considerations of wage
growth, crude prices have a powerful effect on the pricing of commodities made utilizing
hydrocarbons. As earlier noted, crude prices have an independent effect on expenses
such as commuting, manufacturing, and warming.

Changes in oil prices have a range of consequences on macroeconomic performance.

First, rising oil prices cause changes in money from hydrocarbon countries to exporting
countries via trade change conditions. Second, an increase in oil prices affects industry
outputs by increasing the cost of production. Third, the secondary price effect can
magnify the impact of an increase in oil prices. Higher price levels and reduced real
income weaken domestic demand further, resulting in a rise in unemployment.
Furthermore, customers who suffer a loss of real income may request salary increases,
which feeds into greater production costs, which are then passed on to consumers.
Even still, increased oil prices, if prolonged, would dampen Asian economic activity
while threatening to disrupt the delicate balance in the nascent global recovery.

Since the latter part of 2003, Asia's strong economic growth may be attributed to solid
consumption demand and the rise of intraregional commerce. Considering solid
domestic demand, companies have yet to regain pricing power, and increasing
business investment has yet to take a firm grip in many nations, owing to lingering
balance-sheet issues, persisting capacity slack, and, in some cases, political uncertainty
(see ADB 2004). Although enterprises' inability to pass on higher energy input prices to
customers through price increases may dampen the inflationary effect, a strain on
earnings may induce a delay in company investment and employment plans, reducing
growth potential. In comparison to earlier oil shocks, Asia's present economic backdrop
remains favorable, making risks from an increase in oil prices manageable. Asia's vast
foreign reserves would allow the countries to experiment with negative trade conditions.
Subdued inflation also allows for adequate policy assistance should the downside risks
materialize. Nonetheless, increased oil costs raise the risk of the recovered economies
becoming unbalanced. The cornerstone to effecting Asian economic and financial
strategies is to maintain development momentum by restoring internal economic
balance and limiting the impact of foreign uncertainties. Once again, for sufficiently long
solutions to oil price volatility, Asia should make constant efforts to reduce its oil reliance
and boost energy efficiency. Priority should be given to effective energy policy in this
regard. The fast expansion in Asian energy use, which has contributed to the rise in oil
prices, is not a fad. If Asian economies successfully accept essential technical
challenges and develop more efficient methods to create and preserve energy, the
present oil price increase may turn out to be a gift in disguise.

The relationship between stock asset value and crude prices has established much
interest in past decades. AIEA stands for International Energy Agency and according to
this, petroleum contributes by 2030, and 30% of energy consumption will be added to
the Global Energy Mix. The danger and uncertainties related to crude price volatility can
cause concern. Most portfolio managers attempt to earn a profit optimal allocation in
portfolios of investors. This is illustrated by the conceptual framework for the crude price
and stock earnings relationship. Crude prices might have a direct impact on stock prices
by considering future purchasing and future revenues, or they may have an indirect
impact by affecting lending rates, which are used to diminish the worth of future
revenues. They indicate that there has been an increase. The rise of price volatility has
a negative influence on the equity marketplaces of the connected countries, meaning
that perhaps the international oil price is much more essential for the financial markets
than just the domestic crude prices. It investigates the relationship between petroleum
and water prices and overall remunerative in the country, with a focus on examining the
influence of oil price changes on share-market outcomes. The study of the impact of a
crude oil price shock, on share prices in 12 European hydrocarbon countries. Those
who argue whenever a procurement catastrophe occurs and the strength of the dollar
modifications, the consequence on firm profitability is undeniably negligible since this
signifies higher import prices for oil-importing jurisdictions; moreover, once the price of
oil modifications as a result of the policy shocks, the influence on stock market returns it
could be neither neutral.

Countless studies on Asians have been conducted. Asian countries have been urged to
investigate the matter, the relationship between the cure price and the equity markets,
they study the relationship involving crude oil costs as well as the Indian share market.
Consumers claim to believe in utilizing an immediate response of a system when
equities are subjected to a shock, oil prices suffer significantly, it reveals a negative
effect for Pakistan as a result of oil prices, currency value, and the existence of a
connection between international institutional direct investments and the stock market
results. Regardless, it shows that the oil price shocks have no significant influence on
real availability, the majority of Chinese equity markets have historical earnings growth.
The stock market index and according to Coronado et al. (2018), the price of oil are
strongly connected; nevertheless, the direction of the relationship is yet unknown.
However, to the greatest of our knowledge, no research has been conducted.
Addressing the potential links between the South Asian stock exchanges and oil prices.
Just about all South Asian countries were indeed hydrocarbon net explorers, and world
oil price shifts are expected to abuse the money markets of this geographical area. And
hence, the goal of this study is to try to overcome this discrepancy by analyzing both
local and medium quarterly global oil prices and share prices connecting economic
indicators for the South Asian countries from the year 2007 to 2016. The stockholders
investigate a (NARDL) which means Nonlinear Panel ARDL, a research-worthy
variance decomposition panel cointegration platform to provide it.
Considering the present pandemic, another potential avenue, the COVID-19 response
several events have already been precipitated by the epidemic. Economic factors, such
as labor markets and global supply chain stores, consumer purchasing habits, and
securities and futures. The struggling recession or rather significantly reduced direct
investment indicates that emerging markets, like those located in Southern Asia, have
hardly any tools to deal well with adverse repercussions of the current endemic
problems. As something of a matter of fact, South Asian financial systems were indeed
likely to be impacted. Harshest type of situation, the subject has already been analyzed
in published studies. For example, according to Ali et al. (2020), the credit
intermediaries of the significantly affected jurisdictions have disintegrated, - especially
during the final phases of the dispersion. It nonetheless implies that perhaps the oil
price drop may have a paradoxical influence; if people scrutinize the different influences
of just a crisis period, the relevance of COVID-19 throughout the interpretation,
therefore, is left for even more investigation; a rather more comprehensive variant
analysis of something like the hydrocarbon linkage reflecting the burst of covid-19 is
thereby left forward for analysis.
 References

Alamgir, F., & Amin, S. B. (2021). The nexus between oil price and stock market: Evidence

from South Asia. Energy Reports, 7, 693–703. https://doi.org/10.1016/j.egyr.2021.01.027

Nandha, M., & Hammoudeh, S. (2007). Systematic risk, and oil price and exchange rate

sensitivities in Asia-Pacific stock markets. Research in International Business and

Finance, 21(2), 326–341. https://doi.org/10.1016/j.ribaf.2006.09.001

Park, C.-Y. (2004). Higher Oil Prices: Asian Perspectives and Implications for 2004-2005. In

Google Books. DIANE Publishing.

https://books.google.com.ph/books?hl=en&lr=&id=XoLxJKBINFEC&oi=fnd&pg=PA1

&dq=oil+price+hike+philippines&ots=jodgI8d1jM&sig=p0q6h376biYTzOxQop584vM

G3NQ&redir_esc=y#v=onepage&q=oil%20price%20hike%20philippines&f=false