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What causes gas prices to fluctuate - Assignment Example

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Within the oil industry, however, there has been a constant change in the price of commodities. This level of fluctuation affects the operations of other…
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What causes gas prices to fluctuate
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What causes gas prices to fluctuate? What causes gas prices to fluctuate? Background Many industries around the world require fuel to operate and the changes in the prices of gas affect the entire economy. Within the oil industry, however, there has been a constant change in the price of commodities. This level of fluctuation affects the operations of other sectors within the economy and prices must also adjust in a similar direction to those of gas. The need to stabilize and control the prices requires an extensive analysis of the various factors that lead to the price changes in gas (Sullivan, 2003). Because of the wide utilization of gas in many industries, there are a myriad of reasons that could be attributed to the constant changes in the price of gas, and the lack of price stability on the commodity (Diewert, Greenlees & Hulten, 2010). This research will seek to explore the fundamental reasons that drive the fluctuation of gas prices.
Objectives
The research will be undertaken based on the following objectives
To determine the economic factors that cause the constant fluctuation of gas prices
To establish the reasons that make gas prices volatile and subject them to constant fluctuation
To determine other factors, other than economic, which cause the fluctuation of gas prices
Research questions
The research will seek to answer the following questions
What are the economic factors that result in the constant fluctuation of gas prices?
What makes the gas prices so volatile that they cannot at any single time stabilize?
What other factors other than economic have caused the fluctuation of gas prices that has been observed?
Data sources
The research will be a descriptive study that will be seeking to provide answers to various questions raised in relation to the problem of fluctuating gas prices. The study will involve collection of information concerning the current state of the problem in seeking to determine the factors that have driven the observed phenomenon of price fluctuation (Creswell, 2009). Although the research might not be able to provide conclusive answers, it will be able to present some of the key elements that could be associated with causing the price fluctuations. The study will be able to yield rich data that can be relied on by policy makers in establishing solutions to the problem. The sources of data will include economic journals and other academic materials providing explanations to causes of price changes. A survey of the industry will also provide information about the operational factors within the industry that could be causing price fluctuations.
Data analysis
The collected data will be analyzed using STATA, which is a software that facilitates replicable analysis. Qualitative data analysis approaches will be employed to initially analyze the data collected from the various sources (Tracy, 2013). Logical analysis through inductive reasoning will be utilized in seeking to stratify the data before it can be analyzed using the STATA software. The initial analysis will be able to group the collected data into different categories in order to determine the factors that have been identified from the data collection. The stratification will be used to initially identify the factors that have caused the fluctuations in prices of gas. The factors will further be classified into the economic and non-economic factors in order to present an effective analysis of the factors which contribute to the prices to increase.
References
Creswell, J. W. (2009). Research design: Qualitative, quantitative, and mixed methods Approaches (3rd ed.). Thousand Oaks, CA: Sage Publications.
Diewert, W. E., Greenlees, J., & Hulten, C. R. (2010). Price index concepts and measurement (p. 536). Chicago: University of Chicago Press.
Sullivan, A. S. M. S. (2003). Economics: Principles in action (p. 273). New Jersey: Pearson Prentice Hall.
Tracy, S. J. (2013). Qualitative research methods: Collecting evidence, crafting analysis. New Jersey: John Wiley & Sons.
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