THE EFFECT OF OIL PRICE FLUCTUATION ON THE ECONOMY OF NIGERIA

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.

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Impact of Oil Price Fluctuation on the Economy of Nigeria, the Core Analysis for Energy Producing Countries

10.5772/intechopen.94055 ◽

2020 ◽

Author(s):

Jelilov Gylych ◽

Abdullahi Ahmad Jibrin ◽

Bilal Celik ◽

Abdurrahman Isik

Keyword(s):

Exchange Rate ◽

Interest Rate ◽

Forecast Error ◽

Consumer Price Index ◽

Oil Price ◽

Impulse Response Functions ◽

Price Fluctuation ◽

Level Of Significance ◽

Oil Price Fluctuation ◽

Empirical Analyses

The study aims to find the short-run empirical analyses of the impact of oil price fluctuation on the monetary instrument (Exchange rate, Inflation, Interest rate) in Nigeria. We explored the frequently used Toda–Yamamoto model (TY) model, by adopting the TY Modified Wald (MWALD) test approach to causality, Forecast Error Variance Decomposition (FEVD) and Impulse Response Functions (IRFs).The study covered the period 1995 to 2018 (monthly basis), and our findings from MWALD test indicated that there is a uni-directional causality of the log of oil price (lnoilpr) to log of the exchange rate (lnexchr) at 10% level of significance, also there is a contemporaneous response of log of consumer price index (lncpi) to log of exchange rate (lnexchr) and log of interest rate (lnintr), and jointly (lnoilpr, lncpi and lnintr) granger cause lncpi. Also at 5% level of significance lnintr responded due to positive change in lnoilpr and lnexchr, and jointly causes lnintr at 5% level of significance. This is complimented with our findings in FEVDs, and IRFs. The empirical analyses shows that oil price is a strong determining factor of exchange rate, cost of borrowing and directly influences inflationary or deflationary tendencies in Nigeria..

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Research on Brent’s Oil Price Fluctuation and Its Relationship with BDI Index—Based on VAR-GARCH Model

Advances in Social Sciences ◽

10.12677/ass.2016.56116 ◽

2016 ◽

Vol 05 (06) ◽

pp. 825-833

Author(s):

燕君范

Keyword(s):

Garch Model ◽

Oil Price ◽

Price Fluctuation ◽

Oil Price Fluctuation

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OIL PRICE FLUCTUATION AND FIRM PERFORMANCE IN DEVELOPING ECONOMY: EVIDENCE FROM OMAN

International Journal of Energy Economics and Policy ◽

10.32479/ijeep.10990 ◽

2021 ◽

Vol 11 (3) ◽

pp. 381-387

Author(s):

Zaroug Osman Bilal ◽

Shariq Mohammed ◽

Yassir Yaqoub Ali

Keyword(s):

Firm Performance ◽

Oil Price ◽

Developing Economy ◽

Price Fluctuation ◽

Oil Price Fluctuation

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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 ◽

Oil Price Fluctuation

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.

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