Nowcasting Italian Industrial Production: The Predictive Role of Lubricant Oils

Abstract

The paper examines the potential of industrial lubricant oils as a predictor for nowcasting the index of Italian industrial production. The results show that nowcast accuracy can be significantly enhanced during periods of economic turbulence, such as the 2021-22 energy crisis. Industrial lubricant oils are a more robust economic indicator than other commonly used energy-related timely predictors, such as industrial gas consumption. Furthermore, the findings may prove relevant for nowcasting industrial production under structural changes such as the ongoing green transition.

Keywords: nowcasting, industrial production, energy, lubricants