Imagine you are an analyst at an international investment bank whose job it is to predict the daily price of a barrel of oil. What happens if members of Opec, the oil cartel, refuse to sell oil to allies of Israel or if extreme weather conditions hit Europe?
These are the “hypothetical events” of the World Oil Prices Game, a management flight simulator developed by IE Business School in Madrid. The simulator, an interactive model that reproduces real-life business conditions, aims to help students forecast supply and demand in the world petroleum market.
“We’ve always tried hard to put reality into the teaching, but it’s hard to do that with just words,” says Gayle Allard, professor of economic environment and country analysis at IE, who created the simulator in collaboration with professional oil traders. “In a case study, you can talk about possible outcomes and discuss them, but with simulators students can see events unfold before their eyes.”