Future oil prices, where to? A systematic modeling tool for decision makers

The global economy continues its journey of evolution and progression driven by industrialism as its primary force. With such a fast pace of development and recoveries from several recessions through the many years, dependency on energy sources became inevitable to satisfy the rising demand. This paper represents a proposed global energy price model that has the flexibility of modeling the energy price, using data of specific regions of the world, as well as the global energy pricing equation. The ANM (Alternate Novel Model) is presented here. The model focuses mainly on oil price modeling, since the oil accounts for more than 84% of the current world supplied energy. The model duration is 50 years; starting from 1980 to 2030, model matching period from 1980 to 2011, and the prediction period is from 2012 to 2030. The modeling approach used in ANM adopts weighted averaging of individual factor and it relies on line regression technique. Therefore, future trends are being predicted based on the cyclic nature of the market and historical data "the future is reflection of the past". ANM can then predict the futuristic oil price, depending on the factors and variables that have been placed in the process for the output results. The paper aims to propose a reliable model that accounts for most governing factors in the global energy pricing equation. All steps followed and assumption made will be discussed in details, to clarify the working mechanism for this model and pave the road for any future updates.