Impact of Oil Price Fluctuations on Human Development: A Standard Study of Iraq

This paper examines the impact of oil price fluctuations on Human development in Iraq. We employed UNDP statistical data in HDI and oil prices were obtained from OPEC official statistics. EGARCH model is applied to estimate the series of oil price fluctuation. Further, we applied ARDL bound test approach to estimate the long run relationship between HDI and oil price fluctuation. Evidence shows that there is a long run relationship among the variables under study. A significant impact on human development index is witness due to fluctuations in oil prices. Since the dependence of Iraqi economy on oil exports tightly align the government spending with oil revenues. Therefore, this study proposes that Government should adopt a diversified policy and invest in other sectors of the economy, such as the industrial sectors. Investment in these sectors will help to increase the output of exportable goods. Exports of these goods can earn more foreign exchange. This will reduce the heavy reliance on oil revenues. The government needs to spend more money to provide infrastructure like transport facilities and stable electricity supply. This will help encourage private companies to invest more in their economic resources by reducing the cost of doing business.

Oil price Fluctuation, Gold Returns and Inflationary Pressure: An Empirical Analysis Using Cointegration Approach

Applied Economics and Finance ◽

10.11114/aef.v6i2.4054 ◽

2019 ◽

Vol 6 (2) ◽

pp. 71 ◽

Cited By ~ 1

Author(s):

Hanan Naser

Keyword(s):

Crude Oil ◽

Oil Prices ◽

Oil Price ◽

Price Fluctuation ◽

Inflationary Pressure ◽

Crude Oil Prices ◽

Long Run ◽

Short Run ◽

The Impact ◽

Given that oil and gold prices are the major representative for commodity market, they both play a crucial role in determining the level of consumption, industrial production and investment due to the direct effect by the changes in their prices. In addition, both oil and gold prices have inflationary pressure which has a direct impact on countries economic growth. Therefore, it is of crucial practical significance to analyze their cointrgration relationships to understand the co-movement of both prices. To do so, this paper aims to examine the impact of oil price fluctuation on gold prices taking into account the inflationary pressure in the United States (US). Using monthly data from April, 1986 to September, 2018, Johansen multivariate cointegration test procedure and vector error correction model (VECM) have been employed to examine the long-run relationship between the variables in the US. The key findings suggest that there is a significant positive long run relationship between crude oil prices, gold prices and inflation. In the short run, the impact of any changes in crude oil prices will have a delayed effect on the prices of gold, while the impact of inflation in not different from zero. In addition, both gold prices and inflation are found to have no impact on gold prices in the short run. The findings of this research are important for investors, portfolio managers, corporate houses, crude oil traders, the government and policy makers.

The Dynamics of Oil Prices in the Nigerian Construction and Economic Growth

South Asian Journal of Social Studies and Economics ◽

10.9734/sajsse/2018/v1i225782 ◽

2018 ◽

pp. 1-19

Author(s):

Peter Uchenna Okoye ◽

Evelyn Ndifreke Igbo

Keyword(s):

Economic Growth ◽

Price Change ◽

Oil Prices ◽

Oil Price ◽

National Bureau ◽

Construction Sector ◽

Price Fluctuation ◽

Long Run ◽

Long Run Equilibrium ◽

Aims: The continuous reverberation of unstable global oil price change has caused this study to examine the effect of oil price fluctuation on the construction and economic growths in Nigeria. Study Design: Data for the analysis were extracted from different National Bureau of Statistics (NBS) publications on the construction sector and economy (GDP); and OPEC Annual Statistical Bulletin 2017 and BP Statistical Review of World Energy June 2017 on oil price from 1981 to 2016. Place and Duration of Study: The study was done in Nigeria between October 2017 and February 2018. Methodology: The study applied different econometric techniques including the Augmented Dickey-Fuller (ADF), the generalized least squares (GLS) regression (DF-GLS), and the Phillips-Perron (PP) for unit root test; Johansen’s cointegration test and Error Correction Model (ECM) for long-run equilibrium relationship; Granger causality test for direction of causation or influence; as well as carrying different validation tests. Results: It was found that oil price fluctuation does not have any causal influence on the construction growth nor economic growth; rather it is only the economic growth that influences the construction growth without feedback. It further revealed the existence of unstable long-run equilibrium contemporaneous relationship between the variables. It showed that the deviation from the equilibrium level in the current year will be corrected by 8.8% in the following year and that it will take about 11 years and 4 months to restore the long-run equilibrium state on the economic growth should there be any shock from the construction growth and oil prices fluctuation in the system. Conclusion: The study concluded that though construction sector and general economy may be sensitive to the oil price change, their growth cannot be said to have been influenced or caused by the fluctuation in oil prices. On this strength, the subsisting oil price position in determining the economic trends in Nigeria is challenged. It then calls for new thoughts and strategies towards monitoring the oil prices and economic growth in Nigeria which may culminate in paying less attention to oil price changes and focusing more on other economic variables that trigger changes in the economy and development of Nigeria.

Asymmetric Impacts of Oil Price on Inflation: An Empirical Study of African OPEC Member Countries

10.20944/preprints201808.0064.v1 ◽

2018 ◽

Cited By ~ 1

Author(s):

Umar Bala ◽

Lee Chin

Keyword(s):

Food Production ◽

Inflation Rate ◽

Oil Prices ◽

Oil Price ◽

Price Changes ◽

Long Run ◽

Dynamic Panels ◽

The Government ◽

Opec Member ◽

This study investigates the asymmetric impacts of oil price changes on inflation in Algeria, Angola, Libya and Nigeria. Three different oil price data were applied in this study; the specific spot oil price of individual countries, the OPEC reference basket oil price and an average of the Brent, WTI and Dubai oil price. The dynamic panels ARDL were used to estimate the short and the long-run impacts. Also, this study partitioned the oil price into positive and negative changes to capture asymmetric impacts and found both positive and negative oil price changes positively influenced inflation. However, the impact was found to be more significant when oil prices dropped. The results from the study also found that money supply, the exchange rate and GDP are positively related to inflation while food production is negatively related to inflation. Accordingly, policymakers should be cautious in formulating policies between the positive and negative changes in oil prices as it was shown that inflation increased when the oil price dropped. Additionally, the use of contractionary monetary policy would help to reduce the inflation rate, and lastly, it is proposed that the government should encourage domestic food production both in quantity and quality to reduce inflation.

Impact of exchange rate and oil price on the yield of sovereign bond and sukuk: Evidence from Malaysian capital market

Journal of Emerging Economies and Islamic Research ◽

10.24191/jeeir.v5i4.8834 ◽

2017 ◽

Vol 5 (4) ◽

pp. 27

Author(s):

Huda Arshad ◽

Ruhaini Muda ◽

Ismah Osman

Keyword(s):

Exchange Rate ◽

Capital Market ◽

Time Series Data ◽

Oil Prices ◽

Oil Price ◽

Series Data ◽

Sovereign Bond ◽

Long Run ◽

Short Run ◽

This study analyses the impact of exchange rate and oil prices on the yield of sovereign bond and sukuk for Malaysian capital market. This study aims to ascertain the effect of weakening Malaysian Ringgit and declining of crude oil price on the fixed income investors in the emerging capital market. This study utilises daily time series data of Malaysian exchange rate, oil price and the yield of Malaysian sovereign bond and sukuk from year 2006 until 2015. The findings show that the weakening of exchange rate and oil prices contribute different impacts in the short and long run. In the short run, the exchange rate and oil prices does not have a direct relation with the yield of sovereign bond and sukuk. However, in the long run, the result reveals that there is a significant relationship between exchange rate and oil prices on the yield of sovereign bond and sukuk. It is evident that only a unidirectional causality relation is present between exchange rate and oil price towards selected yield of Malaysian sovereign bond and sukuk. This study provides numerical and empirical insights on issues relating to capital market that supports public authorities and private institutions on their decision and policymaking process.

Empirical Analysis of the Impact of International Crude Oil Price Fluctuation on China's Stock Market

DEStech Transactions on Engineering and Technology Research ◽

10.12783/dtetr/mcaee2020/35092 ◽

2020 ◽

Author(s):

Yicheng Chen

Keyword(s):

Stock Market ◽

Crude Oil ◽

Empirical Analysis ◽

Oil Price ◽

Crude Oil Price ◽

Price Fluctuation ◽

The Impact ◽

The Impact of International Oil Prices on the Stock Price Fluctuations of China’s Renewable Energy Enterprises

Energies ◽

10.3390/en12244630 ◽

2019 ◽

Vol 12 (24) ◽

pp. 4630 ◽

Cited By ~ 5

Author(s):

Cody Yu-Ling Hsiao ◽

Weishun Lin ◽

Xinyang Wei ◽

Gaoyun Yan ◽

Siqi Li ◽

...

Keyword(s):

Renewable Energy ◽

Stock Prices ◽

Stock Price ◽

Capital Investment ◽

Spillover Effect ◽

Oil Prices ◽

Listed Companies ◽

Oil Price ◽

Price Fluctuations ◽

In order to address a series of issues, including energy security, global warming, and environmental protection, China has ranked first in global renewable investment for the seventh consecutive year. However, developing a renewable energy industry requires a significant capital investment. Also, the international oil price fluctuations have an important impact on the stock prices of renewable energy firms. Thus, in order to provide implications for market investment as well as policy recommendations, this paper studied the spillover effect of international oil prices on the stock prices of China’s renewable energy listed companies. We used a Vector Autoregressive (VAR) model with innovations using a Factor-GARCH (Generalized Autoregressive Conditional Heteroskedasticity) process to evaluate the impact of market co-movements and time-varying volatility and correlation between the international oil price and China’s renewable energy market. The results show that the international oil price has a significant price spillover effect on the stock prices of China’s renewable energy listed companies. Moreover, the fluctuations of international oil prices have an influence on the stock price variations of Chinese renewable energy listed companies.

Do High Oil Prices Obstruct the Transition to Renewable Energy Consumption?

Sustainability ◽

10.3390/su12114689 ◽

2020 ◽

Vol 12 (11) ◽

pp. 4689 ◽

Cited By ~ 3

Author(s):

Shahriyar Mukhtarov ◽

Jeyhun I. Mikayilov ◽

Sugra Humbatova ◽

Vugar Muradov

Keyword(s):

Economic Growth ◽

Renewable Energy ◽

Energy Consumption ◽

Negative Impact ◽

Oil Prices ◽

Oil Price ◽

Renewable Energy Consumption ◽

Long Run ◽

Carbon Dioxide Co2 ◽

The study analyzes the impact of economic growth, carbon dioxide (CO2) emissions, and oil price on renewable energy consumption in Azerbaijan for the data spanning from 1992 to 2015, utilizing structural time series modeling approach. Estimation results reveal that there is a long-run positive and statistically significant effect of economic growth on renewable energy consumption and a negative impact of oil price in the case of Azerbaijan, for the studied period. The negative impact of oil price on renewable energy consumption can be seen as an indication of comfort brought by the environment of higher oil prices, which delays the transition from conventional energy sources to renewable energy consumption for the studied country case. Also, we find that the effect of CO2 on renewable energy consumption is negative but statistically insignificant. The results of this article might be beneficial for policymakers and support the current literature for further research for oil-rich developing countries.

Changes in Crude Oil Prices and the Flow of Government Revenue

South Asian Journal of Social Studies and Economics ◽

10.9734/sajsse/2019/v5i130139 ◽

2019 ◽

pp. 1-12

Author(s):

Chukwunweike Stella ◽

Achu Tonia Chinedu ◽

Awa Kalu Idika

Keyword(s):

Oil Prices ◽

Oil Price ◽

Government Revenue ◽

Distributed Lag ◽

Autoregressive Distributed Lag ◽

Oil Revenue ◽

Crude Oil Prices ◽

Regression Techniques ◽

The Government ◽

This work is set out as an investigation into the impact of change in oil prices on government revenue broken into oil and nonoil component. Drawing data from the Central Bank Statistical Bulletin and covering the period 1981 to 2018. The Autoregressive Distributed Lag (ARDL) Model was used because of its advantages over other regression techniques. It was found that changes in oil price affected oil revenue within the studied period leaving no significant impact on nonoil revenue. The result obviously reflects the Nigerian economy and its mono-product characteristic. It is therefore recommended that a conscious policy effort should be made to diversify the economy in a manner that makes revenue to the government multifarious functions.

Oil price fluctuations and economic growth: the case of MENA countries

Review of Economics and Political Science ◽

10.1108/reps-12-2019-0162 ◽

2020 ◽

Vol ahead-of-print (ahead-of-print) ◽

Author(s):

Mamdouh Abdelmoula Mohamed Abdelsalam

Keyword(s):

Economic Growth ◽

Linear Models ◽

Oil Prices ◽

Oil Price ◽

Price Changes ◽

Content Type ◽

Price Fluctuations ◽

Mena Countries ◽

Negative Effect ◽

Purpose This paper aims to explore the extreme effect of crude oil price fluctuations and its volatility on the economic growth of Middle East and North Africa (MENA) countries. It also investigates the asymmetric and dynamic relationship between oil price and economic growth. Further, a separate analysis for each MENA oil-export and oil-import countries is conducted. Furthermore, it studies to what extent the quality of institutions will change the effect of oil price fluctuations on economic growth. Design/methodology/approach As the effect of oil price fluctuations is not the same over different business cycles or oil price levels, the paper uses a panel quantile regression approach with other linear models such as fixed effects, random effects and panel generalized method of moments. The panel quantile methodology is an extension of traditional linear models and it has the advantage of exploring the relationship over the different quantiles of the whole distribution. Findings The paper can summarize results as following: changes in oil price and its volatility have an opposite effect for each oil-export and oil-import countries; for the former, changes in oil prices have a positive impact but the volatility a negative effect. While for the latter, changes in oil prices have a negative effect but volatility a positive effect. Further, the impact of oil price changes and their uncertainty are different across different quantiles. Furthermore, there is evidence about the asymmetric effect of the oil price changes on economic growth. Finally, accounting for institutional quality led to a reduction in the impact of oil price changes on economic growth. Originality/value The study concludes more detailed results on the impact of oil prices on gross domestic product growth. Thus, it can be used as a decision-support tool for policymakers.

Multi-Time Scale Spillover Effect of International Oil Price Fluctuation on China’s Stock Markets

Energies ◽

10.3390/en13184641 ◽

2020 ◽

Vol 13 (18) ◽

pp. 4641

Author(s):

Jingran Zhu ◽

Qinghua Song ◽

Dalia Streimikiene

Keyword(s):

Crude Oil ◽

Time Scale ◽

Stock Markets ◽

Spillover Effect ◽

Oil Price ◽

Time Varying ◽

Price Fluctuation ◽

The Impact ◽

With the continuous increase of China’s foreign-trade dependence on crude oil and the accelerating integration of the international crude oil market and the Chinese finance market, the spillover effect of international oil price fluctuation on China’s stock markets increasingly attracts the attention of the public. In order to explore the impact of international oil price fluctuation on China’s stock markets and the time-varying spillover differences of industry sectors, this study proposes three research hypotheses and constructs a multi-time scale analysis framework based on wavelet analysis and a time-varying t-Copula model. In this paper, we use the Shanghai Composite Index as the representative of a general trend of the stock market, and we use the stock index of the China Securities Industry as the counterpart of industrial sectors. Based on the data from 5 January 2005 to 31 May 2020, this paper measures and analyzes the spillover effect of international oil price fluctuation on China’s stock markets, under different volatility periods. The results show that, firstly, the spillover effect of international oil price fluctuation on the Chinese stock markets is different. In the short and medium volatility period, the changes in international oil price are ahead of the changes in the Chinese stock markets, while the latter is ahead of the former under long-term fluctuations. Secondly, the spillover effect of international oil price fluctuation on China’s industry stock indexes is persistent. As the time scale increases, the tail dependency will increase. Finally, the impact of risk events aggravates the volatility of the stock markets in the short-term, while the mid- to long-term impact mainly affects the volatility trend. Investment risk control can make overall arrangement on the basis of the characteristics of oil price impact under different fluctuation stages.