Recent Evidence on the Oil Price Shocks on Gulf Cooperation Council Stock Markets

Victor S.H. Wong and Suzanna El Massah
Authors registered in the RePEc Author Service: Suzanna ElMassah

International Journal of the Economics of Business, 2018, vol. 25, issue 2, 297-312

Abstract: The recent plunge in the price of oil affected many countries, especially major oil producers and exporters, such as the Gulf Cooperation Council (GCC), which accounts for half of the global oil reserves. This paper examines the impact of oil price changes on GCC stock markets, including Bahrain, Kuwait, Oman, Qatar, Kingdom of Saudi Arabia, and United Arab Emirates over a 10-year period, 2005–2015. We examine the direction of influence and influence absorption through Granger causality and impulse response function. The results are important for portfolio management at the international level, and provide insights for government and regulatory authorities in times of oil price change. Additionally, the evidence suggests the need for more economic diversification at the country level in the GCC region to mitigate high volatility in the event of oil shocks.

Date: 2018
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:taf:ijecbs:v:25:y:2018:i:2:p:297-312

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DOI: 10.1080/13571516.2017.1379216

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