EconPapers    
Economics at your fingertips  
 

Global Energy Price Volatility and Agricultural Commodity Prices in Malaysia

Saeed Solaymani

Biophysical Economics and Resource Quality, 2022, vol. 7, issue 4, 1-21

Abstract: Abstract Few studies have differentiated oil demand shocks from oil supply shocks in the literature that has investigated the impacts of these issues on the prices of agricultural products. This study attempts to investigate this problem by employing a structural vector autoregression (SVAR) technique on Malaysian data from January 1993 to December 2019. We found that the reactions of agricultural commodity prices to the changes in global oil prices largely depend on whether they result from oil demand shocks or oil supply shocks. Global oil demand shocks before the food price crisis (2006–2008) can explain a large share of the changes in prices of agricultural products, while after that period, their capacity to explain these changes becomes much weaker. After the food crisis period, the contribution of the oil supply shock to changes in the prices of agricultural products is higher than that of the oil demand shock. We can conclude that the role of oil supply in the economy in explaining changes in the prices of agricultural commodities is stronger after the food price crisis. This is because Malaysia’s economy, as a net oil exporter, benefits from higher oil prices resulting in higher demand for agricultural products and, consequently, higher prices for agricultural commodities.

Keywords: Agricultural commodity prices; Exchange rate; Oil demand shock; Oil supply shock; Structural VAR (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://link.springer.com/10.1007/s41247-022-00105-1 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

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:spr:bioerq:v:7:y:2022:i:4:d:10.1007_s41247-022-00105-1

Ordering information: This journal article can be ordered from
http://www.springer.com/journal/41247

DOI: 10.1007/s41247-022-00105-1

Access Statistics for this article

Biophysical Economics and Resource Quality is currently edited by C.A.S. Hall and U. Bardi

More articles in Biophysical Economics and Resource Quality from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().

 
Page updated 2022-12-24
Handle: RePEc:spr:bioerq:v:7:y:2022:i:4:d:10.1007_s41247-022-00105-1