The Dynamics of Oil Price and Economic Growth in Six Low-Income Sub-Saharan African Countries

This paper highlights the dynamics of oil price and economic growth in six low-income oil-importing countries in sub-Saharan Africa. These countries are Ethiopia, the Gambia, Liberia, Mozambique, Senegal and Tanzania. The study explores the individual countries’ energy sources and the effect of oil price on economic growth. The study found that low-income countries in sub-Saharan Africa mainly depend on biofuel for energy sources and that oil is mainly used in the transport and services sector. Therefore, while the effect of oil price on the economies of low-income countries may not be huge due to the structure of their energy mix, biofuels have an adverse effect on climate change. However, oil demand has increased in the countries examined in this study, with countries like Liberia spending about 15% of its income on oil imports and Ethiopia’s total import volume of petroleum products increasing by approximately 10% from 2017 to 2018. Therefore, low-income countries’ policymakers should pay attention to energy efficiency policies, which have the potential of boosting economic growth and sustainable development.