Achieving Sustained Performance in the Nigerian Oil and Gas Sector despite Exchange Rate Fluctuations: A VAR Approach

Areghan A. Isibor, Adetiloye A. Kehinde, Olokoyo O. Felicia, Adesina F. Tolulope, Akinjare A. Victoria and Udume E. Mercy
Additional contact information
Areghan A. Isibor: Department of Banking and Finance, Covenant University, Nigeria.
Adetiloye A. Kehinde: Department of Banking and Finance, Covenant University, Nigeria.
Olokoyo O. Felicia: Department of Banking and Finance, Covenant University, Nigeria.
Adesina F. Tolulope: Department of Banking and Finance, Covenant University, Nigeria.
Akinjare A. Victoria: Department of Banking and Finance, Covenant University, Nigeria.
Udume E. Mercy: Department of Sociology, Covenant University, Nigeria.

International Journal of Energy Economics and Policy, 2022, vol. 12, issue 3, 341-351

Abstract: The issue of sustaining performance in the Nigerian oil and gas sector is one issue that is of concern to the present government of President Muhammadu Buhari and is in line with the UN s Sustainable Development Goal (SDG) 7 of Clean Energy. The study examined the relationship between exchange rate fluctuations and Nigerian oil and gas sector performance with respect to achieving a sustainable economic growth. The three models used for the study are OBOP = f(OILE, OILI); OILO = f(EXR); and OILE = f(EXR). Secondary data were gathered and analyzed using the vector autoregression (VAR). The unit root test showed that all the variables were stationary at first difference while the Johansen cointegration proved the presence of a long run relationship among the variables in the model. The VAR result revealed that both oil export (OILE(-1)) and oil imports (OILI(-1)) were significant both positively and negatively respectively with overall balance of payments (OBOP). Also, nominal exchange rate (EXR(-1)) was positively significant with OILE while EXR(-1) was negatively significant with OILO. The study therefore recommended amongst others that more refineries should be built in Nigeria, so more products are extracted from crude oil and can be exported to boost revenue.

Keywords: Nigerian oil and gas; Oil export; Oil import; VAR; Balance of Payment (search for similar items in EconPapers)
JEL-codes: F31 K32 Q43 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://www.econjournals.com/index.php/ijeep/article/download/12787/6771 (application/pdf)
https://www.econjournals.com/index.php/ijeep/article/view/12787 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eco:journ2:2022-03-37

Access Statistics for this article

International Journal of Energy Economics and Policy is currently edited by Ilhan Ozturk

More articles in International Journal of Energy Economics and Policy from Econjournals
Bibliographic data for series maintained by Ilhan Ozturk ().