Forecasting Crude Oil Price Using SARIMAX Machine Learning Approach

Oil prices have a significant impact on a nation's economy, and forecasting its prices is essential for effective economic planning and decision-making. However, numerous factors contribute to the volatility of oil prices, making the task of predicting it difficult. This research aims to forecast the oil price and to know the effect of changing the oil price on the global economy. To reach the best results, the secondary data methodology was used, where the closing price of crude oil was collected through the investing.com website for the period from January 2008 to June 2023, and the SARIMAX machine learning model was used to obtain the prediction. The results demonstrated that the price of crude oil will decline in the coming year, and the possible reasons for that are geopolitical tensions due to the Russian-Ukrainian war, the world's tendency to use alternative energy, the political situation between countries and the OPEC control over the oil price. It is advised that investors be cautious and invest in oil prices with specific risks in mind.