Investigating the relationship between oil prices and exchange rates on the price of petroleum products in oil-importing countries

Authors
entezar elnaz
mina pournabi
10.52547/jde.2.7.135
Abstract
One of the global economic crisis is the price fluctuations of oil.Crude oil prices and exchange rates are two important factors in the oil-importing countries. This study examines the impact of real oil prices and exchange rates on the price of petroleum products in oil-importing countries1 using the data panel method, based on annual data provided by the World Bank site over the period 2000-2014. The results showed that fluctuations in the price of crude oil had a major impact on oil prices in different countries, especially oil importers. There is also a negative relationship between the exchange rate and the price of oil products in oil importing countries, and a positive relationship between oil prices and prices for oil products.






1- America, Japan, Italy, India, France, Canada, Thailand, Turkey, Brazil, Australia, Sweden, Indonesia, Netherlands, Portugal and Israel


Keywords
Oil prices
exchange rates
oil products prices
oil importers
data panel methods
- Aliyu, Rano. S. U (2009); Impact of Oil Price Shock and Exchange Rate Volatility on Economic Growth in Nigeria: An Empirical Investigation, Research Journal of International Studies, Issue 11, pp. 4-15.
- Amano, R. A. & Norden, S. (1998). Oil prices and the rise and fall of the US real exchange rate. Journal of International Money and Finance, 17(2): 299-316.
- Asplund, M., Eriksson, R. & Friberg, R. (2000). Price Adjustment by a Gasoline Retail Chain. Scandinavian Journal of Economics, 102: 101-121.
- Bachmeier, L. & Griffin, J. (2003). New evidence on asymmetric gasoline price responses. Rev. Econ. Stat. 85: 772-776.
- Bacon, R. W. (1991). Rockets and Feathers: The Asymmetric Speed of Adjustment of U.K. Retail Gasoline Prices to Cost Changes. Energy Economics, 13: 211-218.
- Balke, N. S., Brown, S. P. A. & Yucel, M. (1998). Crude oil and gasoline prices: an asymmetric relationship? Econ. Financ. Policy Rev. 1: 2-11.
- Borenstein, S. & Shepard, A. (1996). Dynamic Pricing in Retail Gasoline Markets. The RAND Journal of Economics, 27: 429-451.
- Borenstein, S. & Shepard, A. (2002). Sticky Prices, Inventories, and Market Power in Wholesale Gasoline Markets. The RAND Journal of Economics, 33: 116-139.
- Chou, K. & Sun, S. (2012), Crude oil prices, Exchange Rates, and the Asymmetric Response of Retail Gasoline Prices in Taiwan. Econ. Finance. 3(2).
- Farzanegan, M. R. & Markwardt, G. (2008). The Effects of Oil Price Shocks on the Iranian Economy, Energy Economics, 31: 134-151.
- Kaymmetric,L.K. & Aleksander, W. (2014). Asymmetric Price Adjustments in the Fuel Market. Journal of Economic Modelling and Econometrics (CEJEME),6(2): 105-127.
- M.Hakan, B. & Afsin, S. & Serkan, S. (2014). The relative effects of crude oil price and exchange rate on petroleum product prices: Evidence from a set of Northern Mediterranean countries. Journal of Economic Modelling, 42: 243-249
- Pesaran, M. H. (1992). The Iranian Foreign Exchange Policy and the Black Market for Dollars, International Journal of Middle East Studies, 120.
- Shiu, Sheng Chen., Hung, Chyn Chen (2007), “Oil prices and real exchange rates”. Energy Economics, No. 29, pp. 390–404.
- Zhou, S. (1995). The response of real exchange rates to various economic shocks. Southern Economic Journal, 61(4): 936-954