TITLE:
Crude Oil Price Dwindling and the Nigerian Economy: A Resource-Dependence Approach
AUTHORS:
Enaibre Felix Ighosewe, David Chucks Akan, Oghenekparobo Ernest Agbogun
KEYWORDS:
Crude Oil Fluctuation, Economic Performance, Nigeria, Resource Dependence Approach
JOURNAL NAME:
Modern Economy,
Vol.12 No.7,
July
28,
2021
ABSTRACT: This study examined the effect of Crude Oil
Fluctuation and the Nigerian economy: A resource-dependence approach covering a
study period of 35 years (1984-2018). Variables used include Fluctuation in Oil
Price per Barrel (FOBP), Diesel Pump Price Fluctuations (PPPF), Petrol Pump
Price Fluctuations (DPPF), Kerosene Pump Price Fluctuation (KPPF), and Real
GDP. The data were gotten from the CBN Statistical Bulletin, World Bank Report,
and Oil Producing Exporting Countries Annual Report while it was analyzed using
Auto-Regressive Distributed Lag Model. Various diagnostic tests proved that the
model is fit for the study. Accordingly, the trend analysis appears to cast
doubts on whether crude oil fluctuation made significant contributions to the
Nigerian economy. However, the Pearson correlation coefficient substantially
attests to a strong linear relationship between the regressed and the
regressors. Particularly, the individual results restated that in the short run
only Fluctuation in Oil Price per Barrel
(FOBP) improved the Nigerian economy significantly. However, in the long
run, both Fluctuation in Oil Price per Barrel (FOBP) and Kerosene Pump Price Fluctuation (KPPF) improve the Nigerian economy significantly. Hence we conclude that, if
the Nigerian economy must experience outstanding performance, both the
private and public agencies should not interfere in the apex bank surveillance
on the excess crude account. More so, the federal government should endeavor to
industrialize the Nigerian economy.