Oil price changes and industrial output in the MENA region: Nonlinearities and asymmetries

Basel Awartani, Aktham Maghyereh, Julie Ayton

    Research output: Contribution to journalArticlepeer-review

    7 Citations (Scopus)

    Abstract

    In this paper, we investigate the nature of asymmetry in the influence of oil price changes on output in six MENA countries. To get more observations for our analysis, we proxy GDP with industrial output and hence our inference is based on a relatively larger sample compared to previous studies. The results that we obtain are interesting and intuitive. First, we find that growth in MENA countries is linked to oil in the sense that it benefits from higher oil prices and it gets hurt by a fall in the oil market. Moreover, there are pronounced short- and long-term asymmetries in the influence of oil on output. In particular, the output is faster to respond to increases in the oil price than it responds to decreases. The long-term influence to a rise in oil is also higher, though it is realized over a longer period. These results are important and can be used to guide policies that are concerned with stabilizing the economies of the MENA region against oil price fluctuations.

    Original languageEnglish
    Article number117043
    JournalEnergy
    Volume196
    DOIs
    Publication statusPublished - Apr 1 2020

    ASJC Scopus subject areas

    • Civil and Structural Engineering
    • Building and Construction
    • Modelling and Simulation
    • Renewable Energy, Sustainability and the Environment
    • Fuel Technology
    • Energy Engineering and Power Technology
    • Pollution
    • Energy(all)
    • Mechanical Engineering
    • Industrial and Manufacturing Engineering
    • Management, Monitoring, Policy and Law
    • Electrical and Electronic Engineering

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