How did CV-19 impact Fuel Prices?

Impact of the Coronavirus

When you go out to get groceries, you have to make sure you have a face covering, or else, in some stores they won't even let you in. Although you don't want to wear your mask it is imperative that you do.

You have to protect yourself and others from getting the virus!

The Coronavirus has already infected more than 4 million people world wide and caused the deaths of more than 280,000 people.

It is no surprise that governments across the globe took initiative to quarantine their people.

Streets of New York City empty and quiet during COVID-19 pandemic ...

Empty Street in New York City

Because of the quarantine, less people are travelling and thus there are less cars on the road. And with less cars on the road there are less harmful particles in the air and air quality has improved.

However, it is not just air quality that improved, but also my transportation costs.

Gas prices are sooo low right now.
And this led me to dig deeper and question...

Is there a relationship between CV-19 & Fuel Prices?

I decided to narrow down the research and focused on one country. The country I chose was the United Kingdom, as it is Europe's hardest hit, with death counts exceeding 31,000 people.

The fuel related data comes from data.world's weekly competition called MakeOver Monday.
data.world offers datasets every week, where contributors can analyze, improve, and create new data visualizations. I chose to work on 2020/W17: Weekly road fuel prices.
(The original data set was a simple data set that only showed the weekly prices throughout the years, I wanted to expand on this data set and zoom in on trends and compare it to current events).

The data on Coronavirus comes from Our World in Data , a website focused bringing change in the world by providing visualizations and data.

First lets look at how Petrol and Diesel Prices changed over time.

Over the last 18 years, petrol & diesel prices have increased. However, we see two big price reductions, one in 2008 and one in 2020. However, since we are focused on CV-19 lets zoom in, and focus on the years 2019 and 2020.

Percent change in prices from the beginning of 2019 to now

From the graph above we see a sharp decrease in both petrol & diesel prices when the United Kingdom was placed in quarantine. However, we can also see an increase in prices shortly after. Lets see how it compares to its CV-19 death count.

Daily Coronavirus deaths in the United Kingdom

Just like gas prices, we see a pattern, but instead of a decrease we see a sharp increase in the death toll. We also see that the number of deaths are slowly decreasing, on the other hand fuel prices are slowly increasing.

Side by Side Comparison of % diff in fuel prices and CV-19 deaths

We see a side by comparison with the weekly number of CV-19 deaths and percent differences in fuel prices. Note that fuel prices was calculated by averaging the petrol and diesel prices (price of (petrol + diesel) /2) and % difference in prices is reversed with negative five percent on top.

% Difference in CV-19 death & Fuel Prices in the UK

Wow! When we place the weekly percent differences of CV-19 deaths and fuel prices together, we see a similar pattern, where both deaths and fuel prices have a sharp increase and a sharp decrease. Note, however, that the differences in fuel prices are inverted. When CV-19 deaths increased, the fuel prices decreased.

Coronavirus Death vs. Fuel Price (Dollars per Gallon)

Each dot represents a week from Jan 2020 to May 2020. The R-Squared value is .888 and the p-value is 0.0004572. We see a negative correlation between deaths by Coronavirus and Fuel prices in the United Kingdom. The trend line shows a negative exponential relationship between the two variables.

Conclusion

We can see a significant negative relationship between Coronavirus deaths and fuel price in the United Kingdom. However it should always be noted that; correlation does not mean causation. Although the prices fell at a similar rate to which deaths increased, other factors may have contributed to the falling in gas prices.

Limitations & Biases

A limitation to the data was that we only had weekly measurements of petrol and diesel data. It was hard to accurately compare the two variables because the coronavirus data was updated on a daily basis and the fuel data was updated on a weekly basis. There was much more data on Coronavirus in the months of Jan 2020 to May 2020, because each day was 1 record. Each record on UK's fuel data was for the average price of the week.

A bias that is presented in this analysis are the confounding variables. Death rate of Coronavirus is not the only variable that impacts fuel prices, there are many other variables that can affect fuel prices. These variables can be taken into considerations in a future analysis.