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Demand for Oil Products in OPEC Countries: A Panel Cointegration Analysis

Author

Listed:
  • Nourah Al Yousef

    (Department of Economics, King Saud University, Riyadh, Saudi Arabia)

Abstract

The increasing consumption of oil-refined products on OPEC countries will have its impact on the availability of oil exports. The goal of this paper is to examine the determinants of oil refined products’ consumption for a panel consisting of 7 OPEC countries, namely, Algeria, Kuwait, Libya, Qatar, Saudi Arabia, United Emirates and Iran for the period of 1980–2010, by employing the recently developed panel data unit root tests and panel data cointegration techniques. Furthermore, conditional on finding cointegration, the paper extends the literature by employing the Pedroni Panel Fully Modified Ordinary Least Squares (FMOLS) Dynamic OLS (DOLS) procedure to generate. The study estimates the demand for Gasoline, Kerosene and Diesel. An attempt is also made to assess the impact of this demand on the future availability of OPEC oil exports.

Suggested Citation

  • Nourah Al Yousef, 2013. "Demand for Oil Products in OPEC Countries: A Panel Cointegration Analysis," International Journal of Energy Economics and Policy, Econjournals, vol. 3(2), pages 168-177.
  • Handle: RePEc:eco:journ2:2013-02-6
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    References listed on IDEAS

    as
    1. Narayan, Paresh Kumar & Smyth, Russell, 2007. "A panel cointegration analysis of the demand for oil in the Middle East," Energy Policy, Elsevier, vol. 35(12), pages 6258-6265, December.
    2. Dale S. Rothman & J. Ho Hong & Timothy D. Mount, 1994. "Estimating Consumer Energy Demand Using International Data: Theoretical and Policy Implications," The Energy Journal, International Association for Energy Economics, vol. 0(Number 2), pages 67-88.
    3. Majid Ahmadian & Mona Chitnis & Lester C Hunt, 2007. "Gasoline Demand, Pricing Policy and Social Welfare in Iran," Surrey Energy Economics Centre (SEEC), School of Economics Discussion Papers (SEEDS) 117, Surrey Energy Economics Centre (SEEC), School of Economics, University of Surrey.
    4. Peter Pedroni, 2000. "Fully Modified OLS for Heterogeneous Cointegrated Panels," Department of Economics Working Papers 2000-03, Department of Economics, Williams College.
    5. Im, Kyung So & Pesaran, M. Hashem & Shin, Yongcheol, 2003. "Testing for unit roots in heterogeneous panels," Journal of Econometrics, Elsevier, vol. 115(1), pages 53-74, July.
    6. Lee, Chien-Chiang, 2005. "Energy consumption and GDP in developing countries: A cointegrated panel analysis," Energy Economics, Elsevier, vol. 27(3), pages 415-427, May.
    7. Paul Brenton, 1997. "Estimates of the demand for energy using cross-country consumption data," Applied Economics, Taylor & Francis Journals, vol. 29(7), pages 851-859.
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    9. Al-faris, Abdul-razak F., 1997. "Demand for oil products in the GCC countries," Energy Policy, Elsevier, vol. 25(1), pages 55-61, January.
    10. Levin, Andrew & Lin, Chien-Fu & James Chu, Chia-Shang, 2002. "Unit root tests in panel data: asymptotic and finite-sample properties," Journal of Econometrics, Elsevier, vol. 108(1), pages 1-24, May.
    11. Peter Pedroni, 2001. "Purchasing Power Parity Tests In Cointegrated Panels," The Review of Economics and Statistics, MIT Press, vol. 83(4), pages 727-731, November.
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    Cited by:

    1. Adewuyi, Adeolu O., 2016. "Determinants of import demand for non-renewable energy (petroleum) products: Empirical evidence from Nigeria," Energy Policy, Elsevier, vol. 95(C), pages 73-93.
    2. repec:pid:journl:v:55:y:2016:i:4:p:483-497 is not listed on IDEAS
    3. repec:eee:enepol:v:114:y:2018:i:c:p:123-133 is not listed on IDEAS

    More about this item

    Keywords

    OPEC; Demand for Gasoline; Kerosene; Diesel; Cointegration; panel data;

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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