International Conference on Eurasian Economies

9-11 September 2015 – Kazan, RUSSIA

Paper detail

Paper ID : 1362
Status : Paper published
Language : Turkish
Topic : Natural Resources and Environment
Presenter: Asst. Prof. Dr. Müjgan Hacıoğlu Deniz
Session : 5B Bölgesel Ekonomiler I

The Effects of Oil Price Volatility on Foreign Trade Revenue and National Income: A Comparative Analysis on Selected Eurasian Economies
Petrol Fiyatlarındaki Oynaklığın Dış Ticaret ve Milli Gelir Üzerindeki Etkisi: Seçilmiş Bazı Avrasya Ekonomileri Üzerine Bir İnceleme

• Asst. Prof. Dr. Müjgan Hacıoğlu Deniz (İstanbul University, Türkiye)
• Prof. Dr. Kutluk Kağan Sümer (İstanbul University, Türkiye)

Abstract

The aim of this study is to identify the effects of the volatility of oil prices and exchange rates on foreign trade revenue of a few selected Eurasian Economies. These countries are oil and natural gas exporting countries and getting most of their trade revenue from exporting these commodities. The effects of sharply falling oil prices since June 2014 and depreciating exchange rates on these countries’ external trade were analyzed by using alternative econometric models. The sample of this analysis covered the period from June 2014 when oil prices has started falling sharply – till June 2015 in which still world oil price is lower than the price of 140-150 dollars for per gallon in the previous years. Decreasing prices basically destabilize the revenues of these states since approximately two third (2/3) of their export revenue and substantial part of their budget revenue that comes from oil and natural gas. In Russian economy falling prices of oil depreciates both public revenue and economic activity. This means predominantly depending on one commodity for export and foreign trade makes these countries’ economies in dependence of that commodity’s price and makes these economies so vulnerable to global crisis and price volatilities. In order to avoid from this situation, these countries should divert their production and increase in variety for exporting goods.

JEL codes: P28, P33, F17

Hacıoğlu Deniz, Müjgan, Sümer, Kutluk Kağan (2015). "The Effects of Oil Price Volatility on Foreign Trade Revenue and National Income: A Comparative Analysis on Selected Eurasian Economies" in Proceedings of International Conference of Eurasian Economies 2015, pp.298-304, Kazan, RUSSIA.

DOI: https://doi.org/10.36880/C06.01362

Full paper in PDF format.

Session 5B: Bölgesel Ekonomiler I