Examining the Impact of Oil Prices on the Gulf Stock Exchange: A System GMM Approach

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Ruba A. Al-Jarallah
Ruba A. Al-Jarallah

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Examining the Impact of Oil Prices on the Gulf Stock Exchange: A System  GMM Approach

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Abstract

Oil is a critical macroeconomic component of the global economy. This is hardly surprising, given that the global crude oil market is the largest commodity. Oil price swings may reflect or even foretell changes in the political and economic stability of oil-exporting and oilimporting countries. This study examined the impact of oil prices on Gulf country stock markets using data from 2010 to 2020. The study applied the System Generalized Method of Moment estimation approach. The results indicate that stock markets are sensitive to oil prices and that their impact is positive. Similarly, economic activities and interest rates show a positive impact on stock prices. However, the stock market price index is insensitive to inflation. Furthermore, the stock market index depends on its own lag. This study recommends that Gulf Cooperation Council countries diversify their economies for financial stability, rather than relying solely on natural resources.

References

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Funding

No external funding was declared for this work.

Conflict of Interest

The authors declare no conflict of interest.

Ethical Approval

No ethics committee approval was required for this article type.

Data Availability

Not applicable for this article.

How to Cite This Article

Ruba A. Al-Jarallah. 2026. \u201cExamining the Impact of Oil Prices on the Gulf Stock Exchange: A System GMM Approach\u201d. Global Journal of Management and Business Research - B: Economic & Commerce GJMBR-B Volume 22 (GJMBR Volume 22 Issue B6): .

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Oil Price Impact on Oil.
Journal Specifications

Crossref Journal DOI 10.17406/GJMBR

Print ISSN 0975-5853

e-ISSN 2249-4588

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GJMBR-B Classification: DDC Code: 306.342 LCC Code: HM548
Version of record

v1.2

Issue date

December 17, 2022

Language
en
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Oil is a critical macroeconomic component of the global economy. This is hardly surprising, given that the global crude oil market is the largest commodity. Oil price swings may reflect or even foretell changes in the political and economic stability of oil-exporting and oilimporting countries. This study examined the impact of oil prices on Gulf country stock markets using data from 2010 to 2020. The study applied the System Generalized Method of Moment estimation approach. The results indicate that stock markets are sensitive to oil prices and that their impact is positive. Similarly, economic activities and interest rates show a positive impact on stock prices. However, the stock market price index is insensitive to inflation. Furthermore, the stock market index depends on its own lag. This study recommends that Gulf Cooperation Council countries diversify their economies for financial stability, rather than relying solely on natural resources.

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Examining the Impact of Oil Prices on the Gulf Stock Exchange: A System GMM Approach

Ruba A. Al-Jarallah
Ruba A. Al-Jarallah

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