Energy prices and energy security in the European Union: Panel data analysis

ABSTRACT

The main objective of the paper is to determine the level of influences of five variables on energy security (coal, crude oil and natural gas prices, year, and state), which are important indicators in energy forecasting. Research sample includes EU-28 states for a period of 23 years (1990–2012). The results show strong connection between natural gas and crude oil prices. The level of influence of natural gas and crude oil prices changes depending on the remaining variables (a year and/or state). When the state is a variable, the biggest influence is on the natural gas price. When variable year is added, crude oil price has the biggest influence on energy security. Individually speaking, the biggest influence on energy security is the variable year – the moment in time when the influence is happening. Besides, the influence of coal price on energy security is almost identical to the influence of crude oil price.

Keywords:

• Crude oil prices
• energy security
• European Union
• natural gas prices: coal prices: panel data analysis