Optimized Multivariate Adaptive Regression Splines for Predicting Crude Oil Demand in Saudi Arabia

Abstract

This paper presents optimized linear regression with multivariate adaptive regression splines (LR-MARS) for predicting crude oil demand in Saudi Arabia based on social spider optimization (SSO) algorithm. The SSO algorithm is applied to optimize LR-MARS performance by fine-tuning its hyperparameters. The proposed prediction model was trained and tested using historical oil data gathered from different sources. The results suggest that the demand for crude oil in Saudi Arabia will continue to increase during the forecast period (1980–2015). A number of predicting accuracy metrics including Mean Absolute Error (MAE), Median Absolute Error (MedAE), Mean Square Error (MSE), Root Mean Square Error (RMSE), and coefficient of determination (R2) were used to examine and verify the predicting performance for various models. Analysis of variance (ANOVA) was also applied to reveal the predicting result of the crude oil demand in Saudi Arabia and also to compare the actual test data and predict results between different predicting models. The experimental results show that optimized LR-MARS model performs better than other models in predicting the crude oil demand.