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The Impact of Oil Price Changes on Inflation in Pakistan

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  • Afia Malik

    (Pakistan Institute of Development Economics, Islamabad, Pakistan)

Abstract

Oil prices have fluctuated enormously in recent years. Strong volatility in oil prices has serious implications for Pakistan s economy given its substantial dependence on imported fuels. Energy prices have a crucial role behind inflation rates in Pakistan and it is proved in this study. We estimate the effects of oil price changes on inflation for Pakistan using an augmented Phillips curve framework. Our results suggest a strong oil price-inflation relationship, especially when oil prices are rising continuously over the past 1 year.

Suggested Citation

  • Afia Malik, 2016. "The Impact of Oil Price Changes on Inflation in Pakistan," International Journal of Energy Economics and Policy, Econjournals, vol. 6(4), pages 727-737.
    • Handle: RePEc:eco:journ2:2016-04-09
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    References listed on IDEAS

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    Cited by:

    1. Tersoo Shimonkabir Shitile & Nuruddeen Usman, 2020. "Disaggregated Inflation and Asymmetric Oil Price Pass-Through in Nigeria," International Journal of Energy Economics and Policy, Econjournals, vol. 10(1), pages 255-264.
    2. Uddin , Ijaz, 2020. "What determine inflation in Pakistan: an investigation through structural equation modeling by using time series data for a period from 1975 to 2017," Economic Consultant, Roman I. Ostapenko, vol. 32(4), pages 54-72.
    3. Radi Mohammad Adailah & Saba Bassam Al-Damour & Ahmad Al-Majali, 2024. "The Impact of Global Energy Price Volatility on Oil Derivative and Local Price in Jordan: Using DCC-GARCH Model," International Journal of Energy Economics and Policy, Econjournals, vol. 14(1), pages 336-348, January.
    4. Lee, Chien-Chiang & Olasehinde-Williams, Godwin & Özkan, Oktay, 2023. "Geopolitical oil price uncertainty transmission into core inflation: Evidence from two of the biggest global players," Energy Economics, Elsevier, vol. 126(C).
    5. Malik, Afia, 2018. "Fuel Demand in Pakistan's TRansport Sector," MPRA Paper 103455, University Library of Munich, Germany.

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    More about this item

    Keywords

    Oil Prices; Inflation; Pakistan;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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