Abstract
This study analyzes the presence of price leadership of marine fuel oil market(Korea, Japan, Hong Kong, and Singapore) in the East Asia using cointegration test and vector error correction model (VECM) and examine to determine whether the prices of marine fuel oil are set based on international oil prices. As a result of the analysis, cointegration relationships exist among marine fuel oil prices in the East Asia. Results of a weak exogeneity test to examine long-run price leadership show that the marine fuel price of Singapore lead the prices among ports in East Asia in the long-run, and when Dubai international oil prices are included, Dubai oil price leads the prices of fuel oil markets in East Asia. Results of the Granger causality show that Korea-Japan and Japan-Hong Kong have a two-way causality, resulting in short-run price competition between them. When including the Dubai oil price, it was found that the Dubai oil price unilaterally affects the marine fuel prices of all ports in East Asia in the short-run.
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