US-China Trade Tensions and the Global Crude Oil Market

This study examines how US-China trade tensions influence global crude oil volatility (Brent and WTI) in spot and futures markets. Findings show that UCT raises volatility in both benchmarks, with WTI showing stronger volatility responses in futures than in spot markets, reflecting greater sensitivity to US-centered trade shocks. By contrast, Brent exhibits higher volatility in spot markets than in futures, consistent with its global exposure. Incorporating UCT improves forecast accuracy and investor utility, underscoring its relevance for oil market analysis.