Abstract
Abstract The study analyses the role of the petroleum pump price on the consumer price index in Nigeria, using the Nonlinear Autoregressive distributive lag method was used to estimate the time-series data, spanning from 1980 to 2020. The study reveals a long-run equilibrium was found between the consumer price index and petroleum pump price measures. The empirical results obtained revealed an asymmetric relationship between the petroleum pump price and the consumer price index in Nigeria. The study recommended that the policymakers should transparently commit resources into rehabilitation and maintenance of domestic refineries to enhance their functionality and as well reduce importation cost to curtail frequent petroleum pump price adjustment that spiral domestic inflation.
Highlights
Empirical literature (Gelos and Ustyugova, 2017) have established that oil price influences the general price level in an economy
The same thing happens when otherwise occurs. Against this frame of reference, this study carries out an empirical examination of the following questions: What role have petroleum pump price movements played in shaping the domestic inflation rate in Nigeria since the 1980s? Has the impact of the domestic petroleum pump price adjustment changed over time? If so, which factors have accounted for this variation? The main objective of this study is to investigate the asymmetric relationship between the consumer price index and the petroleum pump price in Nigeria
What role have petroleum pump price movements played in shaping domestic inflation since the 1980s? Has the impact of the domestic petroleum pump price adjustment changed over time? If so, which factors have accounted for this variation? It was discovered that the petroleum pump price has been playing a dynamic role in determining the consumer price index in Nigeria
Summary
Empirical literature (Gelos and Ustyugova, 2017) have established that oil price influences the general price level in an economy. A rise or fall in oil prices is directly related to the rate of inflation. This is because oil is a major input of. ISSN: 1584-2339; (online) ISSN: 2285 – 3065
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