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Investigation of the Relationship Between Fuel Prices and Fuel Consumption in Turkey

Author

Listed:
  • Javid Suleymanli

    (Azerbaijan State University of Economics, Baku, Azerbaijan,)

  • Ilkin Mammadov

    (Sustainable Development and Green Economy Research Center, Azerbaijan State University of Economics, Baku, Azerbaijan.)

  • Fariz Ahmadov

    (Azerbaijan State University of Economics, Baku, Azerbaijan,)

  • Tabriz Aliyev

    (Azerbaijan State University of Economics, Baku, Azerbaijan,)

Abstract

This study investigates the impact of fuel price changes on fuel demand in Turkey. The rise in global oil prices since the fourth quarter of 2021 has resulted in considerable increases in oil prices in countries that rely on foreign oil consumption. With the devaluation of the Turkish lira beginning the fourth quarter of 2021, the rise in oil prices reached a historical high in a very short period of time. This situation necessitates the presentation of a recent empirical study to the literature on whether oil consumption changes as a result of oil price fluctuations. Weekly data from 2014 to 2022 were analyzed for this purpose. The fuel expenditures of households with bank and credit cards were utilized as the dependent variable in the study to indicate fuel demand. The average of unleaded gasoline and diesel prices, car sales, car rental charges, and the nominal USD/TL rate are all considered independent factors. According to the analysis, an increase in the exchange rate and gasoline costs lowers the fuel price. The increase in expenses connected to car sales and rental, on the other hand, increases fuel costs.

Suggested Citation

  • Javid Suleymanli & Ilkin Mammadov & Fariz Ahmadov & Tabriz Aliyev, 2022. "Investigation of the Relationship Between Fuel Prices and Fuel Consumption in Turkey," International Journal of Energy Economics and Policy, Econjournals, vol. 12(6), pages 473-480, November.
    • Handle: RePEc:eco:journ2:2022-06-57
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    References listed on IDEAS

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    Cited by:

    1. Nurkhodzha Akbulaev, 2023. "Analysis of Renewable Energy, Foreign Direct Investment, and CO2 Relationship: Evidence from France, Germany, and Italy," International Journal of Energy Economics and Policy, Econjournals, vol. 13(5), pages 645-657, September.
    2. Nurkhodzha Akbulaev & Imangulu Muradzada & Ziyadhan Hasanov, 2023. "Relationship between Oil Prices and Russia Exchange Indices: Analysis of Frequency Causality," International Journal of Energy Economics and Policy, Econjournals, vol. 13(5), pages 607-615, September.

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    More about this item

    Keywords

    Gasoline Price; Gasoline Demand; FMOLS; ARDL; CCR;
    All these keywords.

    JEL classification:

    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • B23 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Econometrics; Quantitative and Mathematical Studies
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models

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