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Ali, Anis. "Governance of public spending avenues by oil prices, oil revenues, and GDP in Saudi Arabia: proportionate sensitivity and trend analysis." Investment Management and Financial Innovations 17, no. 4 (November 30, 2020): 152–64. http://dx.doi.org/10.21511/imfi.17(4).2020.15.
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Saudi Arabia is a petroleum resource-rich country, and half of the GDP of Saudi Arabia is based on the Oil Sector Revenue (OSR). The OSR is governed by the Oil Prices (OP), while GDP is also affected by the OSR in petroleum exporting companies. The volatility of OP governs the OSR and GDP positively and perfectly as the oil sector contributes approximately half of the GDP of Saudi Arabia. The study analyzes the governance of the Public Spending Avenues (PSA) by the OP, OSR, and GDP in the long and short run and based on the secondary data taken from the website of the Saudi Arabian Monetary Authority (SAMA). Coefficient of Variations (CV), Chain-based Index (CBI) numbers, Fixed-based Index (FBI) numbers, and Analysis of Variances (ANOVA) of OP and other dependent variables calculated to get the normality, sensitivity, trend, and significance difference among the sensitivity and trend of variables, while Pearson’s correlations establish the cause-effect relationship among the variables. The study reveals that oil price volatility does not affect the OSR, GDP, and ultimately public spending in the long run. However, there is governance of volatility of OP that can be seen on OSR, GDP, and ultimately on PSA in the short run. Saudi Arabian government enhances its spending on PSA and especially on education while lowering the OP. There is a need to diversify the income resources to minimize the reliability of oil prices and budget deficit and consider the sensitivity of oil prices on the economy by the policymakers to formulate the policies to minimize the impact of volatility of OP on the economy. AcknowledgmentThe author would like to thank the Deanship of Scientific Research, Prince Sattam Bin Abdulaziz University, Saudi Arabia.  
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Alabdulwahab, Sami. "The Linkage between Oil and Non-Oil GDP in Saudi Arabia." Economies 9, no. 4 (December 20, 2021): 202. http://dx.doi.org/10.3390/economies9040202.
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Saudi Arabia is one of the world’s major producers of oil. The Saudi Government has launched its vision for the coming decade: Saudi Vision 2030 (also known as 2030 Vision). Saudi Vision 2030 aims to diversify economic income and be independent of oil revenue. The focus of Saudi Vision 2030 is increasing the role of the non-oil GDP in the economy. In this study, I tried to examine the link between oil and non-oil GDP in Saudi Arabia. I used autoregressive distributed lag (ARDL) cointegration, the most common tool used to examine linkages among variables. My ARDL results confirm the long-term cointegration between non-oil GDP and oil rent, thus implying that oil rent-seeking strategies still exist in Saudi Arabia. The short-term dynamics confirmed the impact of oil rent over the non-oil GDP. The ARDL results led to analyses of asymmetric effects. The NARDL model estimated and confirmed the symmetric effect of the oil rent on non-oil GDP. These results demonstrate the challenges in diversifying Saudi Arabia’s income.
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Charles C., Okeke, and Eze Francis C. "Assessment of the Impact of Oil and Non-Oil Products on Nigeria Gross Domestic Product (GDP)." Business, Management and Economics Research, no. 55 (May 10, 2019): 71–76. http://dx.doi.org/10.32861/bmer.55.71.76.
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This study investigates specifically the impact of Oil and Non-Oil Products on Nigeria Gross Domestic Product (GDP). Data were collected for period 1981-2016 Descriptive Statistics and Multiple Linear Regression Approach was used, defining Oil, and Non-Oil Products as independent variables and Gross Domestic Product (GDP) as dependent variable. From the analysis, Oil, and Non-Oil Products contributes immensely to the Nigeria Gross Domestic Product (GDP). Contrary, the Oil Product is positively and insignificant on economic growth of Nigeria (GDP) and the Non-Oil Product has positively and significant on economic growth of Nigeria (GDP). This study therefore recommends that Nigeria should enhance her export promotion strategies and diversify her economy far away from Crude oil.
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Mukhtarov, Shahriyar, Sugra Humbatova, and İlgar Seyfullayev. "The impact of bank credits on non-oil GDP: evidence from Azerbaijan." Banks and Bank Systems 14, no. 2 (June 10, 2019): 120–27. http://dx.doi.org/10.21511/bbs.14(2).2019.10.
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This study explores the relationship between bank credits, exchange rate and non-oil GDP in Azerbaijan, utilizing FMOLS, CCR and DOLS co-integration methods to the data spanning from January 2005 to January 2019. The results from the different co-integration methods are consistent with each other and approve the presence of a long-run relationship among the variables. Estimation results reveal that there is a positive and statistically significant impact of bank credits and exchange rate on the non-oil GDP in the long run for the Azerbaijani case which are in line with the expectations and with the theoretical findings discussed in theoretical framework section. This finding also indicates that a 1% increase in credit and real exchange rate increases non-oil GDP by 0.51% and 0.56%, respectively. The results of this paper are useful for the policymakers and promote the economic literature for further researches in the case of oil-rich countries.
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Miller, J. Isaac, and Shawn Ni. "LONG-TERM OIL PRICE FORECASTS: A NEW PERSPECTIVE ON OIL AND THE MACROECONOMY." Macroeconomic Dynamics 15, S3 (November 2011): 396–415. http://dx.doi.org/10.1017/s1365100511000265.
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We examine how future real GDP growth relates to changes in the forecasted long-term average of discounted real oil prices and to changes in unanticipated fluctuations of real oil prices around the forecasts. Forecasts are conducted using a state-space oil market model, in which global real economic activity and real oil prices share a common stochastic trend. Changes in unanticipated fluctuations and changes in the forecasted long-term average of discounted real oil prices sum to real oil price changes. We find that these two components have distinctly different relationships with future real GDP growth. Positive and negative changes in the unanticipated fluctuations of real oil prices correlate with asymmetric responses of future real GDP growth. In comparison, changes in the forecasted long-term average are smaller in magnitude but are more influential on real GDP. Persistent upward revisions of forecasts in the 2000s had a substantial negative impact on real GDP growth, according to our estimates.
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Maeda, Akira. "On the Oil Price-GDP Relationship." Japanese Economy 35, no. 1 (April 2008): 99–127. http://dx.doi.org/10.2753/jes1097-203x350104.
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Jahangir, S. M. Rashed, and Betul Yuce Dural. "Crude oil, natural gas, and economic growth: impact and causality analysis in Caspian Sea region." International Journal of Management and Economics 54, no. 3 (September 30, 2018): 169–84. http://dx.doi.org/10.2478/ijme-2018-0019.
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Abstract The main objective of this study was to investigate the impact and causality of crude oil and natural gas on economic growth in the Caspian Sea region. Here, the study applies ordinary least square (OLS) method and Granger causality test using time series data from 1997 to 2015 to ascertain the impact and causality of crude oil and natural gas on economic growth. The results, according to the OLS method, evince that crude oil and natural gas have a significant impact on economic growth of the region. Alongside, considering causality test, gross domestic product (GDP) does Granger cause (unidirectional) crude oil price and export which denotes that GDP can help to forecast crude oil price and export; however, crude oil price and export cannot help to forecast GDP. Surprisingly, this direction is unlikely for GDP and natural gas. GDP and natural gas have unidirectional, but opposite causal relationship, i.e., natural gas price and export do Granger cause GDP which signify that natural gas price and export can help to forecast GDP; however, GDP cannot help to forecast crude oil price and export.
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Said, Husaini, and Evangelos Giouvris. "Oil, the Baltic Dry index, market (il)liquidity and business cycles: evidence from net oil-exporting/oil-importing countries." Financial Markets and Portfolio Management 33, no. 4 (November 27, 2019): 349–416. http://dx.doi.org/10.1007/s11408-019-00337-0.
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AbstractThe recent financial crisis has made (il)liquidity research more significant than ever. Galariotis and Giouvris (Int Rev Financ Anal 38:44–69, 2015) find evidence that market liquidity may contain information for predicting the state of the economy. Similar to (il)liquidity, oil is an important indicator of the future state of the economy (GDP). We consider five predictive variables, namely national/global illiquidity, foreign exchange, Baltic Dry, and oil. Our findings show that (1) global illiquidity provides greater overall explanatory power compared to national illiquidity (even for developed oil exporters: Norway, Canada, and Denmark). (2) Oil is the most important predictive variable for oil exporters (especially for emerging oil exporters suggesting over-reliance), while Baltic Dry appears to be more important for oil importers. (3) FX has extra power over financial variables mainly for emerging oil exporters. Finally, there is a two-way causality between GDP and our predictive variables: (4) For oil exporters, the two-way causality between oil and GDP remains, while for net oil importers, we observe a one-way causality from GDP to oil.
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Humbatova, Sugra Ingilab, Sabuhi Mileddin Ogli Tanriverdiev, Ilgar Nariman Mammadov, and Natig Gadim-Oglu Hajiyev. "Impact of investment on GDP and non-oil GDP in Azerbaijan." Entrepreneurship and Sustainability Issues 7, no. 4 (June 1, 2020): 2645–63. http://dx.doi.org/10.9770/jesi.2020.7.4(6).
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GAVISH, BEZALEL, and ROYI GAVISH. "REDUCING THE USAGE OF CRUDE OIL — WHAT CAN BE LEARNED FROM HIGHEST CRUDE CONSUMER COUNTRIES?" International Journal of Information Technology & Decision Making 11, no. 02 (March 2012): 233–46. http://dx.doi.org/10.1142/s0219622012400019.
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The production and consumption of crude oil became a major issue with the sharp increase in crude oil prices that took place during the last few months. We investigate the relationship between crude oil consumption and the GDP of the top crude oil consuming countries. The amount of GDP produced per barrel of crude oil varies significantly between different countries; the ratio is in the range of 2% to 10% of the GDP when the price of a barrel of crude oil is $100. The paper attempts to explain the high variability with the aim of learning from high GDP producers as to how they are able to generate a larger GDP per barrel of crude oil consumption. The paper also identifies a hysteresis effect in crude consumption reduction and illustrates how understanding it can lead to better production and conservation policies.
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Gao, Dan, Zheng Li, Cheng Gang Yang, Pei Liu, Lin Wei Ma, and Hong Xu. "China Oil Price-GDP Elasticity Coefficient and Optimal Strategic Petroleum Reserve Scale Analysis." Advanced Materials Research 347-353 (October 2011): 98–102. http://dx.doi.org/10.4028/www.scientific.net/amr.347-353.98.
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The rising international oil prices will cause the loss of national GDP and the establishment of strategic petroleum reserves (SPR) could avoid this loss as much as possible. The oil price-GDP elasticity coefficient is an important parameter in calculating strategic petroleum reserve, but since it is difficult to obtain, it is also hard to calculate. This paper provides the fitting formula of oil price-GDP elasticity coefficient based on the regression analyzing of literature data. China’s oil price-GDP elasticity coefficient in recent years has been analyzed and predictions for future trends in different situations have been made. Finally, the predicted oil price-GDP elasticity coefficient is used to calculate the size of China's strategic petroleum reserve and its earnings.
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Aigheyisi, Oziengbe Scott. "Oil Price Volatility and Business Cycles in Nigeria." Studies in Business and Economics 13, no. 2 (August 1, 2018): 31–40. http://dx.doi.org/10.2478/sbe-2018-0018.
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AbstractThe effect of oil price volatility on the business cycle (measured as fluctuations in real GDP) in Nigeria is investigated, while controlling for effects of other variables such as inflation, exchange rate, money supply, trade openness and foreign direct investment. Volatility in real GDP and oil price is generated through the EGARCH process. The ARDL approach to cointegration and error correction modeling is employed for analysis of data covering the period from 1970 to 2015. The study finds positive and significant short-run effect of oil price volatility on real GDP volatility, and no significant long-run effect. The short-run and long-run effects of other variables on business cycle (real GDP volatility) in Nigeria are not statistically significant. This suggests that short-run fluctuations in real GDP are engendered mainly by oil price volatility. This could be attributed to the precarious dependence of the country on oil export. The paper recommends channeling of efforts by the government towards diversifying the productive base and exports of the country as measure to reduce volatility in the real GDP.
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Chuka, Esiaka, Uwaleke Uche, and Amana A. "IMPACT OF NON-OIL FOREIGN TRADE ON ECONOMIC GROWTH IN NIGERIA." International Journal of Development Strategies in Humanities, Management and Social Sciences 11, no. 1 (March 25, 2021): 30–43. http://dx.doi.org/10.48028/iiprds/ijdshmss.v11.i1.03.
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This study probed the impact of non-oil foreign trade on economic growth of Nigeria within the period 1986 to 2018.The specific objectives of this research are to examine the impact of non-oil import on economic growth of Nigeria and the impact of non-oil export on economic growth in Nigeria. The study adopted the ex post facto research design. The data were sourced from Central Bank of Nigeria’s Statistical Bulletin. The study employed the Vector Error Correction Model (VECM) to investigate and analyze the long-run and short-run impact of non-oil foreign trade, proxy by non-oil export and non-oil import; on economic growth, proxy by gross domestic product (GDP). Findings revealed that in the long-run, increase in non-oil export and non-oil import will lead to decrease in the GDP. However, the VECM results indicate that, in the short-run, increase in non-oil import will lead to increase in the GDP, while increase in non-oil export in the short- run will lead to decrease in GDP. From the findings, this study concludes that non-oil import trade has a positive impact on GDP while non-oil export has a negative impact on GDP in Nigeria. This study recommends that Nigeria’s non-oil export should be heavily invested in non-oil high-earning productive sectors such as agriculture and mining. This will create a multiplier effect and increase the productive capacity of non-oil export for sustainable economic development in Nigeria. It is also recommended that non-oil import of Nigeria’s economy should be curtailed by making policies that will encourage import-substitution and enhance economic growth in Nigeria.
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Ju, Yao Ji, and Jian Ming Li. "The Empirical Research on the Relationship of China’s GDP and Oil-Import." Advanced Materials Research 485 (February 2012): 469–72. http://dx.doi.org/10.4028/www.scientific.net/amr.485.469.
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In the current situation, Chinese economy is developing rapidly, and needs import huge quality of oil from different countries. About the relationship between Chinese GDP and quality of import, the thesis uses VAR model to analysis it. The econometric analysis result shows that GDP does Granger cause oil, and imported oil does Granger GDP. And it means that China’s economy development cause the increasing of oil-import and more oil helps the economy develop rapidly. In the end, we have some suggestions to safeguard country’s oil supply safety.
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Czech, Katarzyna. "AGRICULTURAL PERFORMANCE OF OIL-DEPENDENT ECONOMIES." Annals of the Polish Association of Agricultural and Agribusiness Economists XX, no. 6 (December 10, 2018): 35–40. http://dx.doi.org/10.5604/01.3001.0012.7729.
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The aim of the paper is to present the agricultural performance of oil-dependent economies. Based on oil rents as a share of GDP ratio, twenty of the most oil-dependent countries are selected. It is shown that food exports constitute a tiny part of total merchandise exports. It concerns all selected countries apart from Ecuador and Norway. Moreover, agriculture value added is a minor component of GDP for the majority of selected oil-dependent economies. Chad and Nigeria are distinguished by the highest agricultural value added to GDP ratio. Qatar, Kuwait and the United Arab Emirates, on the other hand, are among countries in which the ratio is lower than 1%. Many oil-dependent countries have neglected the rural economy since oil discovery. The agricultural sector is largely ignored in favour of the oil and gas industry. However, it should be emphasized that although agriculture constitutes only a minor share of GDP, in many oil-dependent developing countries, the agricultural sector still provides the main livelihood for most people.
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Saady Mahmood Abaas, Mlaabdal, Olena Chygryn, Oleksandr Kubatko, and Tetyana Pimonenko. "Social and economic drivers of national economic development: the case of OPEC countries." Problems and Perspectives in Management 16, no. 4 (November 2, 2018): 155–68. http://dx.doi.org/10.21511/ppm.16(4).2018.14.
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This paper examines the economic relationships between oil price volatility and socially-economic development of 14 Organization of the Petroleum Exporting Countries (OPEC) using the annual panel data for the period 1990–2014 obtained from the World Bank (WB) statistical data sets. Hausman specification test has been performed to choose the method of panel data analysis, and the results were in favor of fixed effects estimation. The main findings indicate the direct relationship between economic growth and oil price volatility. The research supports the hypothesis that an increase in crude oil prices is positively related to GDP, and a 10% increase in oil prices correlates with 0.6-4% GDP improvements. Structural changes in employment in favor of service sector are negatively correlated with GDP per capita. Changes in GDP structure in favor of oil rents on 10% lead to the shrinking of GDP on 1%. Life expectancy at birth, as an indirect indicator of health, positively influences the economic growth indicators and an improvement in life expectancy on one percentage leads on average to 1% growth in GDP and 0.5-1.33% growth in GDP per capita. Energy efficiency improvements are positive drivers of GDP values at OPEC, and our findings suggest that a 10% increase at GDP per unit of energy use leads to 3% increase of GDP itself. The study recommends investing in energy efficiency, human capital, and capital formation to guarantee long-run economic development and prosperity of OPEC counties.
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Nakibullah, Ashraf. "Economic Diversification in Bahrain." Applied Economics and Finance 5, no. 5 (August 28, 2018): 67. http://dx.doi.org/10.11114/aef.v5i5.3576.
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Countries, such as the GCC countries, that predominantly rely for their income on oil resources face the reality that these sources of their income would not last forever. Thus, being a member of the GCC countries, Bahrain has been pursuing the policies of sustainable and diversified economic growth. This paper uses the share of nonoil real GDP to total real GDP as a measure of diversification to access the extent of diversification in Bahrain. The shares of nonoil GDP increased from 64% in the beginning of this of this century to 80% in 2016 with an average annual growth rate of 6.2% for the period 2002-2016. This success story seems to have an inherent problem. A bivariate structural VAR model with nonoil real GDP and oil price shows that oil prices (indirectly oil sector) have positive impact on the movements of the nonoil real GDP. This means nonoil sector has been very much dependent on the oil sector and neutralizing the dependence is required for the post oil era.
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Harb, Nasri. "Oil Exports, Non-Oil GDP, and Investment in the GCC Countries." Review of Development Economics 13, no. 4 (November 2009): 695–708. http://dx.doi.org/10.1111/j.1467-9361.2009.00524.x.
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Ebenezer, Y. "The Crude Oil Price Changes In The Recent Scenario And Its Impact On The Indian Economy." International Review of Business and Economics 4, no. 2 (2020): 187–96. http://dx.doi.org/10.56902/irbe.2020.4.2.19.
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The crude oil is the major raw material for oil product production in the globalization era. Changes of price will affect country’s economic growth and development. The aim of the study is to examine the Crude Oil Price changes and its impact on the Indian GDP in the recent scenario. To do the same, the study has applied secondary data, statistical tools like chart, the table, graph, correlation and descriptive analysis to show the changes of crude oil price and country’s GDP during the study period. The study reveals that the annual percentage price of crude oil has been increased or decreased positively and negatively but the India’s GDP seems to move forward constantly between 5% to 8% over the study period and the Correlation test conformed that the percentage of crude oil price and percentage change of GDP has moderate positive correlation. OPEC is widely seen as the most influential player in oil price fluctuations in the during the study periods.
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Mukhtarov, Shahriyar, Sugra Humbatova, Mubariz Mammadli, and Natig Gadim‒Oglu Hajiyev. "The Impact of Oil Price Shocks on National Income: Evidence from Azerbaijan." Energies 14, no. 6 (March 18, 2021): 1695. http://dx.doi.org/10.3390/en14061695.
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This study investigates the influence of oil price shocks on GDP per capita, exchange rate, and total trade turnover in Azerbaijan using the Structural Vector Autoregressive (SVAR) method to data collected from 1992 to 2019. The estimation results of the SVAR method conclude that oil price shocks (rise in oil prices) affect GDP per capita and total trade turnover positively, whereas its influence on the exchange rate is negative in the case of Azerbaijan. According to results of this study, Azerbaijan and similar oil-exporting countries should reduce the dependence of GDP per capita, the exchange rate, and total trade turnover from oil resources and its prices in the global market. Therefore, these countries should attempt to the diversification of GDP per capita, the exchange rate, and other sources of total trade turnover.
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Mehrara, Mohsen. "The Relationship between Non-Oil Trade and GDP in Petroleum Exporting Countries." International Letters of Social and Humanistic Sciences 12 (October 2013): 63–70. http://dx.doi.org/10.18052/www.scipress.com/ilshs.12.63.
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This paper investigates the causal relationship between non-oil international trade and the GDP in a panel of 11 selected oil exporting countries by using panel unit root tests and panel cointegration analysis. A three-variable model is formulated with oil revenues as the third variable. The results show a strong causality from oil revenues and economic growth to trade in the oil exporting countries. Yet, non-oil trade does not have any significant effects on GDP in short- and long-run. It means that it is the oil and GDP that drives the trade in mentioned countries, not vice versa. According to the results, decision makings should be employed to achieve sustainable growth through higher productivity and substantially enlarging the economic base diversification in the future.
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Madiha Riaz, Saeed-ur-Rahman, Shahzad Mushtaq, and Aabeera Atta. "Oil Price Flux and Macroeconomy of Oil Exporters." Journal of Accounting and Finance in Emerging Economies 6, no. 2 (June 30, 2020): 651–67. http://dx.doi.org/10.26710/jafee.v6i2.1330.
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Oil is an important energy source, embodies the largest commodity market in the world. Global economic performance has been highly correlated with oil price changes. The study considered 10 major oil exporters to measure the effect of oil price changes on their economies considering variables: Oil Prices (OP), Inflation (CPI) , GDP deflator, Lending interest rate (IR), real interest rate (RIR), Official Exchange Rate (EX), and Net domestic credit (LDU). By applying Johansen Co-integration techniques, long run relationship among variables has been analyzed covering the time period from 1970 to 2019. In order to find the short run relationship, Error Correction Model (ECM) technique is used. Study affirmed that there exist a strong relation among economic variables and oil price fluctuations; however the intensity of relationship displays a variation. Oil prices are associated with GDP deflator and RIR significantly as compared to other variables. Moreover, it can be suggested that each country should observe it own economic strategy in response to price change to reflect on economic policy instead of following some other country trends.
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Zmami, Mourad, and Ousama Ben-Salha. "Oil price and the economic activity in GCC countries: evidence from quantile regression." Equilibrium 15, no. 4 (December 20, 2020): 651–73. http://dx.doi.org/10.24136/eq.2020.028.
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Research background: The effects of oil price fluctuations on the macroeconomic performance in oil-importing and oil-exporting countries have stimulated considerable research activity. However, the debate is far from being closed.
Purpose of the article: This paper revisits the impact of crude oil price on economic activity in the Gulf Cooperation Council oil-exporting countries. The study covers a relatively long period spanning from 1960 to 2018.
Methods: The empirical investigation accounts for structural breaks, nonlinearity, and non-normal ?distribution of data. The Kapetanios (2005) structural breaks unit root test?? and ?Saikkonen?Lütkepohl (2000a, b, c) cointegration test with structural shifts are implemented to examine the stationary properties of data and the presence of cointegration between variables, respectively. Moreover, the quantile regression is employed to assess whether the impact of oil price on real GDP differs across different states of the economy.
Findings & Value added: Empirical results suggest the absence of long-run cointegrating relationships between oil price and GDP in all countries. The quantile regression reveals that oil price does not affect real GDP in the same way across countries and for different business cycle phases. More specifically, the symmetric quantile regression findings reveal that oil price exerts a positive impact on GDP in all countries and that the effect is higher during the recession than expansion states. The asymmetric quantile regression shows that GDP reacts to positive oil price changes in all countries. However, only the Emirati and Omani GDPs are affected by negative oil price changes.
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Al Rasasi, Moayad H., John H. Qualls, and Bander K. Algamdi. "Oil Revenues and Economic Growth in Saudi Arabia." International Journal of Economics and Financial Research, no. 53 (March 10, 2019): 49–55. http://dx.doi.org/10.32861/ijefr.53.49.55.
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This paper examines the relationship between Saudi oil revenues and the Kingdom’s economic growth over the past 47 years. In analyzing the data that are needed for this analysis, problems were encountered with the basic real GDP and government oil revenue data that are typically used. The most widely-used measure of non-oil private sector activity that is available, the Non-Oil Private Institutional Sector GDP, does not include the Gross Value Added of all of the private activities, omitting over SAR 80 billion of real activity (in 2010 prices). A new series was constructed, consisting of all of the non-oil private activities, including the recently corporatized/privatized companies. In addition, the oil revenue data prior to 1987 were found to be unsatisfactory for use as published, due to their being based on the 354-355 day Hijra calendar. A new conversion methodology, based on a recently published paper by Qualls et al. (2017), was applied, and the pre-1987 data were converted to a consistent Gregorian basis with good results. The two series were determined to have a unit root of order one, with a highly significant long-run relationship. An error-correction model was then estimated, and highly significant short- and long-run relationships were found. A Ganger Causality test was performed, with the results confirming the ECM’s results, with real government oil revenue growth “Granger-causing” real private-sector GDP growth. Finally, the new non-oil activity GDP measure produced better results than did the traditionally-used Non-Oil Private Sector GDP.
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Al-Zuhair, Mohammad, and Talal AL-Bazali. "Causality Between Energy Consumption and Economic Growth: The Case of Kuwait." International Journal of Energy Economics and Policy 12, no. 6 (November 28, 2022): 22–29. http://dx.doi.org/10.32479/ijeep.13477.
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The causality relationship between energy consumption and economic growth for Kuwait was investigated in this study, and the impact of increasing local energy prices on Kuwait’s economic growth was examined. Our methodology relied on statistical analyses to study the causality trends between various factors such as GDP; annual oil production; oil-reserves depletion; annual energy consumption; and CO2 annual emission, to formulate a hypothesis that determine the actual causality relationship between GPD and energy consumption without having to use the already-established statistical methods. Results showed no solid foundation to support the application of growth or conservation hypothesis. Results support the neutrality hypothesis which specifies no causality relationship between energy consumption and economic growth (GDP), especially from the year 2007/2008 and beyond, which allows for adopting stricter local-energy prices with no effect on the overall economic growth of the country. Results showed, however, a close relationship between oil exports (sales) and total GDP for Kuwait. The difference between total GDP and oil GDP exactly equals the non-oil related economic growth contribution to the country’s economy. The findings of this study provide reliable and suitable basis for policymaking not only in Kuwait, but also in other single-source oil-producing countries such as GCC countries.
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Khan, Haroon. "The Impact of Oil and Gold Prices on the GDP Growth: Empirical Evidence from a Developing Country." International Journal of Management Science and Business Administration 1, no. 11 (2015): 34–46. http://dx.doi.org/10.18775/ijmsba.1849-5664-5419.2014.111.1004.
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The global hike in the prices of gold and oil made an impact in the economy of the countries around the globe. The impact has varied in the developing and developed countries. The research is a preliminary investigation into the subject matter. It has plunged into the relation of these two commodities prices with the GDP of an emerging economy of Pakistan. The findings give a compelling insight into the subject matter. The study used the stock market data with the average Gold and Oil prices from the period of 1997 to 2014. The data analysis results show that gold and oil prices have a significant impact on GDP.
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Brueckner, Markus. "Infrastructure and Economic Growth." Journal of Risk and Financial Management 14, no. 11 (November 11, 2021): 543. http://dx.doi.org/10.3390/jrfm14110543.
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I estimate the effect that growth in countries’ GDP per capita has on the growth rate of infrastructure. In order to extract exogenous variation in GDP per capita growth, I use the growth of the international oil price multiplied with countries’ GDP shares of oil net-exports as an instrumental variable. My instrumental variables estimates show that, for both democracies and autocracies, GDP per capita growth has a significant positive effect on infrastructure growth. This effect is significantly smaller in anocracies—so much so that, in anocracies, GDP per capita growth has no significant effect on the growth rate of infrastructure.
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Aulia, Sarah, and Akhmad Syakir Kurnia. "ANALYSIS GLOBAL BUSINESS CYCLE AND FISCAL RISKS : An Empirical Study of ASEAN-5." JURNAL DINAMIKA EKONOMI PEMBANGUNAN 1, no. 1 (April 30, 2018): 33. http://dx.doi.org/10.14710/jdep.1.1.33-46.
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This thesis aims to analyze global business cycle and fiscal risk in ASEAN-5 which is expected to be explained by several explanatory variables including primary balance/GDP, oil price, economic growth, output gap, and LIBOR interest rate. More spesifically, this thesis focus on the effect of oil price with Debt/GDP is a benchmark of fiscal risk. This research used panel data of ASEAN-5 period 2000-2014. Prior to conducting the analysis, this study looked at the correlation coefficients between the cycle components (output gap) and the primary balance per GDP to identify the fiscal policy character in each country. The cycle component is calculated by using the difference between original series and trend components using Hodrick Prescott Filter. The fiscal policy characteristics of Indonesia, Malaysia, Phillipines, and Thailand apply procyclical policies while singapore implements countercyclical fiscal policy. The results of the analysis conducted using the fixed effect method show the global business cycle and world oil price fluctuations affect the fiscal risks. The results of this study indicate when the business cycle in a state of booming domestic governments tend to increase government spending and create fiscal risks. Meanwhile, the LIBOR and Primary Balance rate per GDP which is a variable derivative of the fiscal suistanability concept has an effect on fiscal risk. However, economic growth has no effect because the current debt is the tax burden in the future.
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Artami, Rina Juliet, and Yonosuke Hara. "The Asymmetric Effects of Oil Price Changes on the Economic Activities in Indonesia." Signifikan: Jurnal Ilmu Ekonomi 7, no. 1 (January 12, 2018): 59–76. http://dx.doi.org/10.15408/sjie.v7i1.6052.
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This paper analyzes the asymmetric impact of oil price changes on the economic growth of and inflation in Indonesia by using the vector autoregression (VAR) model for the period from 1990Q1 to 2016Q4. The results show that the impact of oil price changes on the gross domestic product (GDP) is asymmetric, as a drop in oil prices decreases the GDP, whereas an increase in oil prices does not significantly affect GDP. It is crucial for Indonesia to reduce its dependency on oil, mainly as its primary source of revenue, and also consider utilizing more sources of renewable energy. At the same time, the effects of both the positive and negative changes in oil prices are found to be not statistically significant to inflation. The lack of impact of oil price changes on inflation can explain by the implementation of the fuel price subsidy in Indonesia.DOI: 10.15408/sjie.v7i1.6052
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Czech, Katarzyna. "OIL DEPENDENCE OF POST-SOVIET COUNTRIES IN THE CASPIAN SEA REGION: THE CASE OF AZERBAIJAN AND KAZAKHSTAN." Acta Scientiarum Polonorum. Oeconomia 17, no. 3 (September 30, 2018): 5–12. http://dx.doi.org/10.22630/aspe.2018.17.3.32.
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The aim of the research is to present oil dependence of Azerbaijan and Kazakhstan from 2000 till 2017. The analysed countries represent two former Soviet Union countries in the Caspian Sea region and are among the world’s top 15 oil dependent economies. It is shown that both countries generate high oil rents to GDP ratios. Moreover, the paper reveals that their fuels export constitutes a huge portion of total merchandise export. It implies that majority of Azerbaijani and Kazakhstani export revenues come from resources extraction. The empirical analysis of co-movements between the crude oil prices and chosen macroeconomic indicators shows that correlation between oil prices and Kazakhstani and Azerbaijani public debt to GDP ratios is negative, strong and significant. In addition, there is significant relationship between oil prices and Kazakhstani exchange rate and GDP growth rate.
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Lescaroux, F. "An Interpretative Survey of Oil Price-GDP Elasticities." Oil & Gas Science and Technology - Revue de l'IFP 62, no. 5 (September 2007): 663–71. http://dx.doi.org/10.2516/ogst:2007059.
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Hoque, Asraul, and Naief Al-Mutairi. "An econometric model of Kuwait's non-oil GDP." Applied Economics 28, no. 7 (July 1, 1996): 783–90. http://dx.doi.org/10.1080/000368496328218.
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Kromtit, Matthew J., Charles Kanadi, Dorathy P. Ndangra, and Suleiman Lado. "Contribution of Non Oil Exports to Economic Growth in Nigeria (1985-2015)." International Journal of Economics and Finance 9, no. 4 (March 30, 2017): 253. http://dx.doi.org/10.5539/ijef.v9n4p253.
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This study examines the contribution of non oil export to the growth of the Nigerian economy for the period 1985-2015. The economy is experiencing a fall in exchange earning, a fall in GDP, depletion of external reserve, scarcity of foreign exchange, and high cost of goods. This is as a result of the sudden fall in international oil price. Thus, this forms the motivation for the study. Augmented Dickey Fuller was used to test for unit root and to ascertain the stationarity of the variables. The result showed non oil exports to be stationary at level while economic growth proxied by Gross Domestic Product (GDP) and exchange rate were stationary at first difference. Auto-regressive distributed lag (ARDL) model was then employed to ascertain the relationship between non oil exports and GDP. The Bound test conducted showed the presence of cointegration which means a long run relationship among the variables existed. The ARDL regression result indicated a positive and significant relationship between non oil exports and GDP. This means non oil exports contributed significantly to economic growth in Nigeria. The result also revealed that exchange rate had a negative though not significant relationship with GDP which is in line with economic theory. The study recommended making legislation that makes participation in non oil sectors like agriculture, solid minerals and manufacturing easy by both local and foreign investors, provision of credit at lower interest rate to the non oil sectors and direct participation in developing these sectors by the government.
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BESSO, Christophe Raoul, and Erick Patrick FEUBI PAMEN. "OIL PRICE SHOCK AND ECONOMIC GROWTH: EXPERIENCE OF CEMAC COUNTRIES." Theoretical and Practical Research in the Economic Fields 8, no. 1 (June 30, 2017): 5. http://dx.doi.org/10.14505/tpref.v8.1(15).01.
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The objective of this paper is to evaluate the impact of oil shocks on the growth rate of Growth Domestic Product (GDP) in CEMAC countries. We use a panel VAR model approach to the variation of the real GDP growth rate, oil price inflation rate and money supply between 2000 and 2015. Our main results show that CEMAC countries mostly depend on oil pension. Consequently, the analysis of impulsion response functions and the decomposition of variance show that, the shock on oil price negatively affects the growth rate of the GDP. We then suggest CEMAC countries to diversify their production, the destination of their exports and the sources of budgetary income or takings.
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Kathiravan, Chinnadurai, Murugesan Selvam, Balasundram Maniam, Leo Paul Dana, and Manivannan Babu. "The Effects of Crude Oil Price Surprises on National Income: Evidence from India." Energies 16, no. 3 (January 20, 2023): 1148. http://dx.doi.org/10.3390/en16031148.
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The goal of this study is to look into how changes in crude oil prices affect GDP per capita and exchange rate fluctuations.to investigate the influence of crude oil price shocks on GDP per capita and exchange rate movements. This research employed yearly time series data for the price of crude oil, exchange rate (USD/INR), and GDP per capita, from 1990 to 2020. Arithmetical tools such as Descriptive, Unit Root, Granger Causality Test, and OLS Model were applied. The present study discovered a strong bi-directional Granger causality effect of Dubai crude oil prices on exchange rates, as well as a bi-directional Granger influence of exchange rates on WTI crude oil prices. The diagnostic tests were successfully passed by the estimated models. According to the OLS model, the exchange rate was driven only by the price of Dubai crude oil, although the price of WTI crude oil influenced both the GDP per capita and the exchange rate over the research period. The key policy recommendation derived from this analysis is that the Reserve Bank of India (RBI) must depreciate the rupee, first to restore much-needed exchange rate stability, then to stimulate domestic manufacturers, and finally, to attract foreign capital inflows.
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Köseoglu, Sinem Derindere, Khalid Khan, and Mahmuna Ifat. "Relationship between Oil Prices and Economic Growth in GCC Countries." Liberal Arts and Social Sciences International Journal (LASSIJ) 3, no. 1 (December 31, 2019): 106–20. http://dx.doi.org/10.47264/idea.lassij/3.1.10.
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This study explores the relations between Oil Prices (OP) and Gross Domestic Product (GDP) per capita in Gulf Cooperation Council (GCC) countries using the asymmetric causality test for the period of 1996-2018. The results of the standard bootstrap causality test reveal bidirectional causality between the OP and the GDP per capita in Qatar and Saudi Arabia. The results of asymmetric causality tests are different for some countries, which demonstrate the unidirectional causality running from OP+ to GDP+ in Oman and Saudi Arabia. Whereas, the bidirectional causality exists between the GDP- and OP- in Kuwait and Oman and unidirectional causality exists between the OP- and the GDP- per capita in Bahrain, Qatar, and UAE. The results support the Real Business Cycle Theory (RBC Theory), which states that external positive or negative shocks have significant impact on GDP per capita through consumption and investment channels. GCC countries should channelize the huge revenues towards other private sectors, which will create more prospects for the GDP and will provide substitution in case of arising any crisis. In addition, the GCC countries must diversify their economic activities since the OP are quite volatile and uncertain and the revenues of these countries are dependent on the OP to a large extent. Sustainable development can be achieved through a balanced path between government expenditures and future savings.
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Osintseva, Marina A. "Influence of Oil Factor on Economic Growth in Oil-exporting Countries." International Journal of Energy Economics and Policy 12, no. 1 (January 19, 2022): 217–24. http://dx.doi.org/10.32479/ijeep.11794.
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Traditional types of energy resources, among which oil is primary, have a huge influence on economic development in various manifestations. In our research, we discuss dependence of economic growth in oil-exporting countries on first-order factors, such as oil prices, oil production, and structural shift in a share of oil exports. To review 2005-2019, we chose leading oil-exporting nations, including the OPEC members (Iraq, Iran, Libya, Saudi Arabia, and Nigeria), as well as countries outside this group (Russia, Kazakhstan, Azerbaijan, and Norway). Having used statistical and regression techniques, we confirm that the correlation between oil price fluctuations and economic growth raises with the scale effect. Larger economies (by absolute GDP in oil-exporting nations and hydrocarbon production) might generate more intensive economic growth from positive changes in oil prices than small economies. Also, the OPEC members show the strongest structural shifts in the change of the share of oil exports than the other countries. Resulting regression dependences led us to the conclusion that in oil-exporting countries, economic growth largely depends on an increase in oil prices and changes in oil production rates. But contrary to the expectations saying that in time of downturns, as far as global oil prices fall, nations will reduce oil exports, we observe the reverse picture – changed role of the price factor. We explain this with the keeping income-balance strategy, where the oil price parameter is a tool to choose ideal production. Our findings show that with the 1%-increase in oil production, the countries under considerations (the OPEC members) might reach GDP from 0.0367% (Iraq) to 0.437% (Libya). For countries outside OPEC, such a GDP growth might be more intensive. For instance, in Russia, it might be up to 1.559%. This also points out that the joint coordinating policy in oil production affects the economic growth potential.
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Yarasevika, Samara, Suharno Suharno, and Rita Nurmalina. "Determinan Ekspor RPO Indonesia di Pasar Organisasi Kerjasama Islam." Jurnal Agribisnis Indonesia 10, no. 2 (December 19, 2022): 350–61. http://dx.doi.org/10.29244/jai.2022.10.2.350-361.
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Indonesia has been the largest exporter of Refined Palm Oil (RPO) in the world which OIC countries being main export destination markets. However, most of Indonesian RPO exports to the OIC countries are still concentrated in four countries, namely Pakistan, Malaysia, Bangladesh, and Egypt. The distribution of Indonesian RPO exports to the OIC countries is still in small number due to the high tariff applied by several OIC countries. This research aims to analyze the factors that influence Indonesian palm oil trade in 20 OIC countries. The analysis methods used Gravity Model and Trade Potential Analysis. The result using gravity model showed that the real GDP per capita of destination countries, the real GDP per capita of Indonesia, exchange rate, price, tariff, and the RCA index of Indonesian RPO in destination countries are significantly influence its volume exports. On the other hand, economic distance and population of destination countries do not have a significant effect on the RPO export volume.
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W., M. Ichsandimas, and Malik Cahyadin. "World Oil Prices and Indonesia Macroeconomic." Jurnal Ekonomi Pembangunan: Kajian Masalah Ekonomi dan Pembangunan 15, no. 1 (March 29, 2015): 27. http://dx.doi.org/10.23917/jep.v15i1.120.
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The goal of this study is to look at the relation and contribution value, while the impact of world oil price on the macroeconomic Indonesian form 1980 to 2010. This Study used Vector Auto Regression (VAR) method and tool of VAR used are Impulse Response Function (IRF) and Variance Decomposition. The results of study finds a positive relation and statistically significant impact of world oil price on inflation and real GDP Indonesian, but not significant and negative relation on real exchange rates. World oil price has contribution value on the inflation, real exchange rates, Indonesia real GDP after first period.
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Malik, Afia. "Crude Oil Price, Monetary Policy and Output: The Case of Pakistan." Pakistan Development Review 47, no. 4II (December 1, 2008): 425–36. http://dx.doi.org/10.30541/v47i4iipp.425-436.
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Rapid rises in the prices of crude oil in the decade of 2000s have raised concerns among policy-makers around the world, as the theoretical and empirical literature has established that oil price shocks may have an adverse impact on the macro economy of the country. In particular, for the oil importing developing countries like Pakistan, this upward trend in the price of oil can have serious repercussions in terms of creating inflationary pressures in the economy, increasing budget deficit and balance of payment problems, and thus affecting the GDP growth. Pakistan was on the path of rising GDP growth in the first seven years of this decade. But in the year 2007-08, the situation has changed. This oil price shock could possibly be one of the reasons. As an impact of rising growth rate of GDP, demand for energy has also gone up rapidly in this period. In the energy mix for the year 2005-06, oil accounts for 32 percent of the total energy used in Pakistan, and it is the second largest source of energy used after natural gas, which accounts for 39 percent. With oil being the second largest source of energy used along with almost constant rate of its production Pakistan is heavily dependent on oil imports from Middle East exporters (Saudi Arab playing the lead role). Almost 82 percent of the demand for petroleum products in the country is met through imports.1 Pakistan spent about 44 percent of export earnings on oil imports in 2006-07. This percentage was only 27 percent in 2004-05. Therefore, the international oil price increase has a direct impact on the macro economy of the country, especially on the oil price GDP relationship. The share of net oil imports in GDP is an indicator of the relative importance of the oil price rise to the economy in terms of the potential adjustments needed to offset it. For Pakistan over the last few years, this ratio has risen from 3.13 in 1990-91 to -5.24 in 2005-06 [Malik (2007)]. With such a high ratio, unless country is running in surplus, or has extremely large foreign exchange reserves, high oil price is dealt by severe macro economic adjustments.
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Majidli, Famil, and Hasraddin Guliyev. "HOW OIL PRICE AND EXCHANGE RATE AFFECT NON-OIL GDP OF THE OIL-RICH COUNTRY – AZERBAIJAN?" International Journal of Energy Economics and Policy 10, no. 5 (August 10, 2020): 123–30. http://dx.doi.org/10.32479/ijeep.9561.
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Wu, Jiuxia. "Research on the Impact of International Oil Prices on the Economy of Russia." E3S Web of Conferences 214 (2020): 03006. http://dx.doi.org/10.1051/e3sconf/202021403006.
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In the process of Russian economic development, the oil industry is one of the important pillar industries. More than 50% of the total revenue of the Russian government comes from the oil and gas industry. Oil and oil products exports account for about 56.9% of Russia’s total export[1]. So Russia’s economy is inextricably linked to oil prices. Rosneft’s role in budgetary revenue sources is growing. In the development of the world economy, the change of international oil price affects the development of the Russian economy. This paper reviews the relevant theories about the relationship between oil price and Russia’s economic growth. Besides, the short-term and long-term effects of oil price fluctuation on Russian economy are analyzed with Keynes’s income determination theory and “resource Curse” theory[2] respectively. In addition, the granger causality test is used to analyze the relationship between the fluctuation of oil price and the change of Russian GDP. The following conclusions are drawn from the analysis. Firstly, oil price rise is beneficial to Russian economic growth in the short term, but will hinder Russia’s economic long-term development. Secondly, the fluctuation of oil price is the granger cause of the change of Russian GDP. However, the change of Russian GDP is not the granger cause of the fluctuation of oil price.
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Zou, Xiaohua. "An analysis of the effect of carbon emission, GDP and international crude oil prices based on synthesis integration model." International Journal of Energy Sector Management 12, no. 4 (November 5, 2018): 641–55. http://dx.doi.org/10.1108/ijesm-10-2017-0013.
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PurposeThis paper aims to analyze the impact of the relations between the US oil prices, carbon emissions and GDP through the analysis of data between 1987 and 2017.Design/methodology/approachARIMA, VAR and VEC models are used to establish synthesis integration model. Furthermore, the stability test, cointegration test and Granger causality test of the model were carried out.FindingsThe results indicate that, in both short and long term, change in oil prices is the reason for change in carbon emissions, while GDP is not the reason for the growth of carbon emissions.Originality/valueIncrease of oil prices would have a negative impact on carbon emissions, and GDP growth does not lead to an increase in carbon emissions.
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Sarkhanov, T. "The Effect of Oil Prices on Azerbaijan’s Economy." Economy of Region 18, no. 4 (2022): 1287–300. http://dx.doi.org/10.17059/ekon.reg.2022-4-23.
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Since oil plays an important role in the economy of Azerbaijan, the events in the global oil market deeply affect the national economy. Moreover, the COVID-19 pandemic influenced the economy of Azerbaijan, in which oil and gas have a significant place. In April 2020, the price of one barrel of oil on the world market fell to $1. One reason for this was the decrease in oil demand due to the lockdown regime implemented by many countries due to the rapid outbreak of the COVID-19 pandemic, and another reason was that the OPEC (Organization of the Petroleum Exporting Countries) countries could not agree on reducing oil production. The aim of this research is to show the impacts of oil prices on gross domestic product (GDP) of Azerbaijan, the growth rate of GDP, and the amount of oil production in Azerbaijan in 2009-2018. The hypothesis of the research is that oil prices seriously influence the economy of Azerbaijan and there is a correlation between the growth rate of Azerbaijan’s gross domestic product and the oil prices. The study starts with a brief description of the history of Azerbaijan’s oil industry, followed by oil industry’s importance in the economy of Azerbaijan, the role in foreign economic relations, and the effects on the economy of country. The quantitative method was used as a key research method. The data used in the analysis of this study were collected according to the literature scanning method, which is one of the data collection techniques. Further, descriptive statistics technique, which is a quantitative data analysis technique, was used to analyse the data. The findings show that the changes in oil prices in 2009-2018 directly affect the Azerbaijan’s gross domestic product, the growth rate of GDP, and the amount of oil production in Azerbaijan. Thus, as oil prices increase, the growth rate of the country’s gross domestic product and GDP increase and decrease as oil prices decrease.
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Szaruga, Elżbieta, Zuzanna Kłos-Adamkiewicz, Agnieszka Gozdek, and Elżbieta Załoga. "Linkages between Energy Delivery and Economic Growth from the Point of View of Sustainable Development and Seaports." Energies 14, no. 14 (July 14, 2021): 4255. http://dx.doi.org/10.3390/en14144255.
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This paper presents the synchronisation of economic cycles of GDP and crude oil and oil products cargo volumes in major Polish seaports. On the one hand, this issue fits into the concept of sustainable development including decoupling; on the other hand, the synchronisation may be an early warning tool. Crude oil and oil products cargo volumes are a specific barometer that predicts the next economic cycle, especially as they are primary sources of energy production. The research study applies a number of TRAMO/SEATS methods, the Hodrick–Prescott filter, spectral analysis, correlation and cross-correlation function. Noteworthy is the modern approach of using synchronisation of economic cycles as a tool, which was described in the paper. According to the study results, the cyclical components of the cargo traffic and GDP were affected by the leakage of other short-term cycles. However, based on the cross-correlation, it was proved that changes in crude oil and oil products cargo volumes preceded changes in GDP by 1–3 quarters, which may be valuable information for decision-makers and economic development planners.
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Sreenu, Nenavath. "The Effects of Oil Price Shock on the Indian Economy—A Study." Indian Economic Journal 66, no. 1-2 (March 2018): 190–202. http://dx.doi.org/10.1177/0019466219876491.
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The article examines the effects of crude oil price shocks on the Indian economy development and GDP growth for the period of 2010–2018. Currently, the Indian economy has been facing the identical issues of escalating trade disparity and continuing inflation. In this connection, the study focussed on the determination of the relationship between the speculation and crude oil price impact on the Indian economic development activity and GDP growth, and the paper investigated how oil price variations affect the Indian economy development through different networks like WPI, CP, IIP, GDP, monetary policy, trade and investment. The research paper adopted methods such as GARCH model and description to tool the volatility on both the oil and stock markets, and then an extension of the vector auto-regression (VAR) models is also applied to determine the oil price shocks’ effect on macroeconomic indicators. The outcomes of cointegration model propose that crude oil is pro-cyclical to output, and the article used VAR investigation to check the discrepancy in decomposition to capture the linear inter-dependencies among the variables. JEL Classification: G4, G11, G15
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Nkomo, Jabavu Clifford. "Crude oil price hikes and issues for energy security for Southern Africa." Journal of Energy in Southern Africa 21, no. 2 (May 1, 2010): 12–16. http://dx.doi.org/10.17159/2413-3051/2010/v21i2a3251.
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This paper addresses a number of issues related to crude oil prices, focusing on Southern Africa. It begins by analysing oil price movements from 1970 to 2008, and examines various factors that may have contributed to the sharp rise and fall in prices. A characteristic feature in the oil market is the time lags it takes to react to price changes. A high oil intensity of GDP makes the economy vulnerable to oil price increases, so that countries with a high oil/GDP ratio are harder hit than others. There are two main issues for energy security: first, on whether the potential use of the oil weapon can be taken seriously; and second, how to minimize vulnerability to oil supply shocks by reducing oil dependence and by a developing or enlarging a strategic stockpile of oil.
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Sadath, Anver Chittangadan, and Rajesh Herolli Acharya. "The macroeconomic effects of increase and decrease in oil prices: evidences of asymmetric effects from India." International Journal of Energy Sector Management 15, no. 3 (February 8, 2021): 647–64. http://dx.doi.org/10.1108/ijesm-02-2020-0009.
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Purpose The purpose of this paper is to assess whether oil price shocks emanating from oil price increase and decrease have a different impact on the macroeconomic activity. Design/methodology/approach This study conducts the empirical analysis using structural vector auto-regressive model on Indian data for the period from 1996 to 2017. This paper uses four key macroeconomic variables, namely, real gross domestic product (GDP), the real rate of interest, real money supply, wholesale price index inflation and various linear and non-linear measures of oil price shock. Findings Empirical results confirm that oil price shock has a significant impact on various macroeconomic variables used in the study. Specifically, shocks emanating from a decline in oil price have a stronger positive impact on real GDP, whereas, a shock due to the rise in oil price has a weaker negative impact on real GDP. Impulse responses confirm that shocks due to a decline in oil prices are long-lasting compared to similar shocks due to a rise in oil prices. Therefore, this study concludes that the macroeconomic impact of oil price shock is asymmetric in India. Originality/value This paper adds the following new insights: First, this paper presents a distinct relationship between the growth rate of oil price and GDP during increasing and decreasing phases of oil price to drive home the case for this study. Second, India has adopted crucial administrative initiatives such as deregulation of the market for petroleum products and the promotion of renewable energy during the study period. Finally, previous studies have revealed specific behavioral and economic features of people in India with respect to the demand for petroleum products. In light of these factors, this paper based on Indian experience would be justified.
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Szira, Zoltán, Alghamdi Hani, and Erika Varga. "Examining the Impact of Oil Price Change on the Economy through GDP Change." Acta Carolus Robertus 9, no. 2 (2019): 149–59. http://dx.doi.org/10.33032/acr.2019.9.2.149.
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Petroleum economics is the field that studies human utilization of petroleum resources and the consequences of that utilization. Petroleum use allows the production of energy. Resources can be regarded as renewable or depletable; petroleum falls into the latter category, which can have an effect on pricing strategies. Crude oil is one of the main natural feedstocks used to meet energy demands and price variation has a significant influence on the society development. A large amount of research suggests that oil price fluctuations have considerable consequences on economic activity. These consequences are expected to be different in oil importing and in oil exporting countries. Whereas an oil price increase should be considered positive news in oil exporting countries and negative news in oil importing countries, the reverse should be expected when the oil price decreases. The paper investigates the co-movements and causality relationship between oil prices and GDP of selected oil exporting countries. Our assumption is decreasing oil prices have a negative impact on the GDP of such countries.
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Nguyen Thi Ngoc, Trang, and Hong Dinh Thi Thu. "Nonlinear effects of oil prices on inflation, growth, budget deficit, and unemployment." Journal of Asian Business and Economic Studies 24, no. 01 (January 1, 2017): 75–91. http://dx.doi.org/10.24311/jabes/2017.24.1.04.
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In oil-exporting countries such as members of the OPEC, fluctua-tions in oil prices exert a significant impact on the domestic econo-my. Currently, a sharp reduction in oil prices results in several ad-verse effects; however, for such a crude-oil exporter that is also an importer of petroleum products as Vietnam, does a rise or drop in oil prices is beneficial to its development? This paper attempts to de-termine the oil price threshold while analyzing oil price effects on several macro factors, such as inflation, GDP growth, budget deficit, and unemployment rate over the 2000–2015 period. Using TVAR model, we detect an oil price threshold of USD27.6/barrel. Moreover, an increase in the price of oil, which exceeds this threshold, will cause a rise in inflation, budget deficit, and unemployment rate. Still, there is no significant evidence of the impact of oil prices on GDP growth.