Analysis of the impact of oil price on natural rubber price—An empirical study based on VAR model

In recent years, the price of oil has gradually presented negative correlation with the price of natural rubber, and it is contradictory to the previous study conclusion that the price of oil and the price of natural rubber have been positively correlated. In this paper, the transmission mechanism of the influence of oil price on natural rubber price was analyzed. Through the granger causality test and co-integration test, the result showed that there was a granger causality relation between the oil price and the natural rubber price, and the situation would be in long-term equilibrium. In addition, the effect of oil price on the price of natural rubber was verified by the VAR model, and the results showed that the former is not a simply positive effect on the latter. So we concluded that the original conclusion was not imperfect, and it was not considered that the change of the supply and demand relationship of the natural rubber would influence the relationship between oil and natural rubber on price. At last, some countermeasures and suggestions were put forward from the perspective of investors and producers.