The Survey of World Oil Prices Endogenous Factors Effect on Foreign Imbalances of Iran

Abstract

Given the importance of the oil sector in the economy and its impact on the revenues of the oil sector as part of the external balance, The aim of this study was to investigate the effects of global real price of oil on the international level. Based on theoretical, world oil prices of endogenous factors such as oil supply and demand and the whole world demand affected and A necessary condition to obtain this effect, the use of these exogenous factors is the economic model. This study during the period 1973-2007 using the structural vector regression model and vector regression model shows the effect of oil price shocks on the external balance of the country's. The results show that oil shocks have a weak direct effect on the balance of foreign, but strong indirect effect on the external balance and This is due to the oil and non-oil balance. In various oil shock, 48% and 42% of non-oil balances justify fluctuations of other variables foreign(Maximum attachment), so trade balance is very important for external imbalances.

Keywords

• world oil prices
• structural var model
• oil demand shock
• oil supply shock
• external imbalances