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The Influence of Oil Price Fluctuations on Stock Market of Developing Economies: A Focus on Nigeria

Author

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  • Chuke Nwude

    (Department of Banking and Finance, Faculty of Business Administration, University of Nigeria, Nigeria,)

  • Damilola Felix Eluyela

    (Department of Accounting and Finance, Landmark University, Nigeria,)

  • Elias Igwebuike Agbo

    (Department of Banking and Finance, Faculty of Business Administration, University of Nigeria, Nigeria,)

  • Francis O Iyoha

    (Department of Accounting, College of Business and Social Sciences, Covenant University, Nigeria)

Abstract

The inconclusiveness of findings from various studies on Nigeria on the effect of crude oil price fluctuation on the stock market has led to an argument in literature, thus necessitating further exploration of the subject. This study examines the effect of variations in the price of crude oil on selected stock market performance variables in Nigeria using monthly frequency data covering January 1997 to December 2016. Variance decomposition, impulse response analysis, and VAR estimations were employed for the study. The results reveal that oil price variations are slowly transmitted in some stock market performance variables. The findings indicate that the effect of crude oil price fluctuations in the Nigerian stock market is greatly minimized and does not sufficiently account for market activities.

Suggested Citation

  • Chuke Nwude & Damilola Felix Eluyela & Elias Igwebuike Agbo & Francis O Iyoha, 2021. "The Influence of Oil Price Fluctuations on Stock Market of Developing Economies: A Focus on Nigeria," International Journal of Energy Economics and Policy, Econjournals, vol. 11(3), pages 100-109.
    • Handle: RePEc:eco:journ2:2021-03-13
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    References listed on IDEAS

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    Cited by:

    1. Zeravan Abdulmuhsen Asaad & Amjad Saber Al-Delawi & Omed Rafiq Fatah & Awaz Mohamed Saleem, 2023. "Oil Exports, Political Issues, and Stock Market Nexus," International Journal of Energy Economics and Policy, Econjournals, vol. 13(1), pages 362-373, January.

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    More about this item

    Keywords

    Emerging Economy; Nigeria; Oil Price Shocks; Stock Market; VAR.;
    All these keywords.

    JEL classification:

    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • Q47 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy Forecasting
    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance

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