The relative effects of crude oil price and exchange rate on petroleum product prices: Evidence from a set of Northern Mediterranean countries

Hakan Berument (), Afsin Sahin and Serkan Sahin

Economic Modelling, 2014, vol. 42, issue C, 243-249

Abstract: This paper provides a set of empirical evidence from five Northern Mediterranean countries that are subject to similar refinery reference prices regarding the relative sensitivity of crude oil prices and exchange rate on (pre-tax) petroleum product prices. The empirical evidence reveals that a one percent increase in exchange rate (depreciation) increases petroleum product prices less than a one percent increase in crude oil prices does in the long run. In the short run, however, a one percent increase in exchange rate increases petroleum product prices more than a one percent increase in crude oil prices does.

Keywords: Oil prices; Exchange rates; Asymmetry (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (23)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:42:y:2014:i:c:p:243-249

DOI: 10.1016/j.econmod.2014.07.019

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