Abstract:
This study examines how reciprocal tariff escalations between the US and China affect the volatility of their energy markets. The results show that tariff announcements significantly increased volatility in both markets, with the Chinese energy markets exhibiting stronger pre-event reactions and larger overall shocks. This research contributes to the understanding of asymmetric pre-event reactions in energy markets to tariff announcements, specifically showing that Chinese energy markets exhibit stronger anticipatory responses compared to the US market.
