Inventory demand for crude oil

A model of inventory demand for crude oil is developed to look at the behaviour of inventory demand in four countries, U.S.A., Germany, Japan and U.K. After a brief description of the oil market structure, the thesis outlines some of the general models on inventory theory. A survey of the literature concludes that few attempts were made to model inventory demand for crude oil. A model based on the assumption that consumers are not faced with any fixed costs associated with placing orders and that they can order at discrete moments of time is proposed. The model is estimated for U.S.A., Germany, Japan and U.K. The estimation is based on data spanning 1980-1987. (Author)