THE EFFECTS OF URANIUM PRICE FLUCTUATIONS ON PRODUCTION, EXPLORATION EXPENDITURES AND RESERVES: VAR APPROACH

Authors

  • Sondès Kahouli Université de Bretagne Occidentale. UMR AMURE. France

DOI:

https://doi.org/10.15173/esr.v19i1.536

Keywords:

Uranium price, Uranium production, Uranium exploration expenditures, Uranium reserves, VAR modeling,

Abstract

The aim of this paper is to empirically analyse the effects of uranium price fluctuations, i.e. increase vs decrease, on uranium production, uranium exploration expenditures and uranium reserves. We apply a Vector Autoregression (VAR) approach which allows for both symmetric and asymmetric model specifications to simulate impulse-response functions (IRFs) and derive the forecasting error variance decomposition (VD).
Results give evidence that a uranium price increase induces an exploration expenditures increase and, to a lesser extent, a production increase. In contrast, no significant effect of uranium price fluctuations on uranium reserves can be supported. Results also give evidence of the presence of asymmetric aspects in the response of uranium exploration expenditures and uranium production to uranium price fluctuations. In fact, uranium exploration expenditures and uranium production seem to be more sensitive to uranium price increases than to uranium price decreases.

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Published

2012-01-01

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Section

Articles