The Effect of the Spread of COVID-19 on the Relationship between the Total Index of the Tehran Stock Exchange and the Price of the OPEC Oil Basket using Cubic Spline Approximation

Mohammad Gholami Baladezaei ¹ ( )
Elahe Sarfi ² ( )
Hosein Mohammad-Pour Kargar ³ ( )

Submited date : 2023-09-19 Accepted date : 2025-03-11

Keywords: Cubic spline interpolation, Total index, OPEC oil basket price,

Abstract :

The rapid spread of COVID-19 among humans led to an epidemic and, in addition to jeopardizing the health of people in the community, it also affected social life. To manage similar crises in the future, the basics of approximation can be used to estimate the severity of the impact of emerging crises on other phenomena. The purpose of this research is to guide policies to calculate the risk of an epidemic so that the costs of response or prevention are adequately assessed. Therefore, in this article, the relationship between the changes in the total price index of the Tehran Stock Exchange and the oil price of the OPEC basket has been evaluated by the cubic spline approximation during the outbreak of COVID-19. The price of the OPEC oil basket and the total index of the Tehran Stock Exchange were approximated based on the time variable with a cubic spline during the years 2018 to 2022. Then, by removing the time variable from the obtained functions, the relationship between the two variables was estimated. The cubic spline approximation function showed that the monthly price of OPEC oil during the outbreak of Corona from the 22nd to 26th months decreased sharply and then increased. The total index of the Tehran Stock Exchange has had an upward trend during the same period. The ratio of the total index price of the Tehran Stock Exchange to the oil price of the OPEC basket in the months of 22 to 28 was divided into two parts. In both periods, functions were introduced that can be used to predict and approximate similar crises.

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