Global Crude Oil Price, Oil Revenue and Economic Performance: Dutch Disease Hypothesis

Abstract

The purpose of this paper is to give a general understanding of the global crude oil price, oil revenue and economic performance vis-à-vis Dutch disease proposition. This work explores the relationship between the price of crude oil and its oil revenue generation on the regions of the Organization of the Petroleum Exporting Countries (OPEC) and non-Organization of the Petroleum Exporting Countries (non-OPEC). The crude oil price has recently been ?uctuating greatly that it cannot be predicted; this ?uctuation causes changes in the oil revenues, thus affecting the economy worldwide. To better understand the factors that affect the crude oil price, this study examined West Texas Intermediate (WTI), Brent, Dubai oil and OPEC oil prices whether the Global oil fluctuation in these countries have a signi?cant effect on the ?uctuation of Oil revenues. Various studies have con?rmed the importance of crude oil prices to the global economy. This study focuses on the relationship between crude oil prices and oil revenue levels. However, therefore, in addition to the in-depth understanding of the relationship between oil prices and oil revenues, the relationship other variables and oil prices is valuable and worthwhile topic to explore. The findings of the studies reviewed revealed that the agriculture sector, manufacturing and telecommunication sector exerted a positive and significant impact on Nigerian economic performance and diversification dwindling oil revenue should be invested heavily on productive non-tradeable sector according to Dutch diseases hypothesis (Riti et al., 2016).