The Effect of Oil Price Fluctuation on Iraq’s Economy From 2008 to 2018

Post by: Muthanna mjdes
November 7, 2022
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Karrar Yunus Lefta ^*a & Mustafa Kadhimi Najaf Abadi ^b

a Al-Mustafa University / Iran

Abstract

In this research, the changes in oil price and its influence on the world’s economy, generally, and particularly on Iraq’s economy from 2008 to 2018 is reviewed. Full information about the general incomes and oil specific incomes and domestic gross production in relation to that period are compiled. Further, the statistical data in relation to review of influence of the fluctuations in oil price on Iraq’s economy are analyzed to prevent such future influences . On the other hand, the influence of fluctuations in the oil price on the Iraq’s economy are review from a number of aspects, the most important of which is the financial incomes in the general budget, financial inflation rate and unemployment rate. In the present study, the most important factors that affect the global oil price ,its global saving and alternate energy resources are reviewed. Such that the extent of contribution of the petroleum sector is compared and contrasted with the domestic gross production. The results indicate that Iraq’s economy is an interest-oriented, mono-product economy based on oil incomes, such that the contribution of the petroleum sector in national gross production in the abovementioned period ranges from 98 to 99 percent. In addition, according to the results, upon oil price decline, Iraq will encounter sever economic recession. It also became clear in this research that as long as the agriculture and industry sectors are not developed for the purpose of foreign currency resources diversity and oil production increase, and the central funds are not constituted in order to save the assets upon promotion of crude oil price and to use it by sudden decline of oil price, Iraq’s economy will remain interest-oriented one