Selected Oil Price Benchmarks and Sustainable Revenue Profile of OPEC Member Countries: A Symmetric and Asymmetric Analyses

Felicia Osondu Okwueze, Umoru Husseini Tijani, Ben Madu Ekwuye, Lawal Faith Chidinma, Wilfred Isioma Ukpere, Ndubuisi N. Udemezue and Ebere Ume Kalu ()
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Felicia Osondu Okwueze: Department of Public Administration, University of Nigeria, Nsukka 410105, Nigeria
Umoru Husseini Tijani: Department of Banking and Finance, Enugu Campus, University of Nigeria, Enugu 400241, Nigeria
Ben Madu Ekwuye: Department of Banking and Finance, Enugu Campus, University of Nigeria, Enugu 400241, Nigeria
Lawal Faith Chidinma: Business Education Department, Kogi State College of Education, Ankpa 261101, Nigeria
Wilfred Isioma Ukpere: Department of Industrial Psychology and People Management, University of Johannesburg, Johannesburg 2092, South Africa
Ndubuisi N. Udemezue: Department of Banking and Finance, Alex Ekwueme Federal University, Ndufu-Alike P.B. Box 1010, Nigeria
Ebere Ume Kalu: Department of Banking and Finance, Enugu Campus, University of Nigeria, Enugu 400241, Nigeria

Sustainability, 2025, vol. 17, issue 22, 1-31

Abstract: This paper examines the impact of different oil price benchmarks on the revenue profile of OPEC countries from 1990 to 2024. While there are prior studies on this subject, most of these studies adopted a symmetrical approach, overlooking the asymmetric effects of price shocks on government revenues. Additionally, prior research often aggregates oil price benchmarks, simplifying the complex dynamics influencing OPEC revenues. This study fills these gaps by evaluating both symmetrical and asymmetrical responses of the revenue profiles of OPEC countries to major global oil price benchmarks—NYMEX WTI, ICE Brent, DME Oman, and the OPEC reference basket. The study employs linear and nonlinear panel (ARDL) models on annual data from 1990 to 2024. The linear ARDL results indicate that government revenues respond positively to ICE Brent, NYMEX WTI and OPEC spot prices but negatively to DME Oman prices. The nonlinear ARDL model reveals asymmetric responses: revenue is more sensitive to negative shocks in ICE Brent and OPEC prices, while DME Oman price increases reduce revenues. Notably, NYMEX WTI fluctuations have minimal impact. The main conclusion of the paper is that OPEC’s fiscal stability is highly vulnerable to asymmetric, long-run oil price shocks. The study recommends policymakers adopt benchmark-specific fiscal hedging strategies, such as put options, and strategically diversify export markets to mitigate risk.

Keywords: crude price; revenue; asymmetries; OPEC (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:17:y:2025:i:22:p:10062-:d:1791957

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