This is a model that has been used to determine current crude oil prices, as discussed in the Hamilton article that goes over the different models of crude oil price determination. So it should tell us what determined the current price of crude oil. Solve for p1 as a function of the other variables. What does the current price, p1 depend on, and how? That is, for example, if s, storage costs, influence the current price, p1, do higher storage costs cause p1 to increase or decrease? That is, is there a positive or negative correlation?
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This is a model that has been used to determine current crude oil prices, as discussed in the Hamilt...
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