The Long-run and Short-run Effects of Crude Oil Price on Methanol Market in Iran
AbstractSubstituting crude oil exports with value-added petrochemical products is one of the main strategies for policy makers in oil-driven economies to isolating the real sectors of economy from oil price volatility. This policy inclination has led to a body of literature in energy economics in recent decades. As a case study, this paper investigates the short-run and long-run relationship between Iran’s oil price and methanol price which is one of the most important non-oil exports of the oil-exporting country. To do so, the weekly data from 18 Jan. 2009 to 18 Sep. 2011 in a VECM framework is applied. The results show that in the long-run, oil price hikes leads to proportional increase in methanol price while in the short-run, this impact is not significant.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 45975.
Date of creation: 04 Oct 2012
Date of revision:
Publication status: Published in International Journal of Energy Economics and Policy 1.3(2013): pp. 43-50
Crude Oil; Methanol; VECM Model;
Other versions of this item:
- Akbar Komijani & Nadiya Gandali Alikhani & Esmaeil Naderi, 2013. "The Long-run and Short-run Effects of Crude Oil Price on Methanol Market in Iran," International Journal of Energy Economics and Policy, Econjournals, vol. 3(1), pages 43-50.
- C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
- C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models
- Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-04-13 (All new papers)
- NEP-ARA-2013-04-13 (MENA - Middle East & North Africa)
- NEP-ENE-2013-04-13 (Energy Economics)
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