Paper Summary:

This paper analyzes percentage increases or decreases in American troop deaths against movement in petroleum oil prices during the same months. It then introduces a one- and two-month lag to allow petroleum markets to react to troop deaths. The paper concludes that increases or decreases in troop deaths typically do not have the same effect on oil prices, and may even have a reverse effect. The paper contains tables and graphs.

Table of Contents:
Abstract
Introduction
The Immediate Effect
One- and Two-Month Lags
Conclusion

From the Paper:

"By analyzing a two-month lag, we are left with 15 data points. In only six of the 15 months did refined petroleum prices move, two months later, in the same direction as troop casualty figures (See Table 1 and Graph 1). The three months with the largest increases in troop casualties (145.2 percent in April 2006; 60 percent in December 2006; and 51.2 percent in August 2006), were only followed two months later by an increase in refined petroleum prices once -- in February 2007. Of the nine months analyzed where at least a 20 percent change in troop deaths occurred, only four times was there similar movement in refined petroleum prices two months later. Interesting enough, in three of the five months where at least a 30 percent change in troop deaths occurred, refined petroleum prices moved in the same direction two months later. While this allows for an argument that refined petroleum prices, with a two month lag, can be influenced by movements in troop deaths that exceed a certain trigger point, the argument is far from convincing. After all, the overall correlation between troop deaths and refined petroleum prices after a two month lag is weak, and at the 20 percent trigger mark, refined petroleum prices moved in sync less than half the time."

Sample of Sources Used:

• Hall, K. (2006). "What will war cost? Studies weigh oil prices, lost productivity, more." The Seattle Times, Jan. 14. Retrieved Nov. 20, 2007 at http://seattletimes.nwsource.com/html/nationworld/2002739307_warcosts14.html.
• Kopytoff, V. (2002). "Iraq war could hit at pump." San Francisco Chronicle, Nov. 20. Retrieved Nov. 22, 2007 at http://www.sfgate.com/cgi- bin/article.cgi?file=/chronicle/archive/2002/11/20/BU4619.DTL.
• "U.S. deaths by month" (2007). Icasualties.org Web site. Retrieved Nov. 20, 2007 from http://icasualties.org/oif/US_chart.aspx.
• U.S. total gasoline retail sales by all R&G (cents per gallon) (2007). U.S. Department of Energy Web site. Retrieved Nov. 20, 2007 from http://tonto.eia.doe.gov/dnav/pet/hist/a103600002m.htm.

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