Dynamics of the Relationship Between Oil Price Fluctuations and Iraqi Financial Markets: An Econometric Study Using the VECM Model for the Period (2000–2025)

Authors

  • اسلام محمد محمود

    جامعة الانبار- كلية الادارة والاقتصاد

    Author

DOI:
https://doi.org/10.61710/glj.v2i2.83
Keywords:
Oil Prices, Financial Markets, Iraq, VECM Model,
Abstract
Abstract. This study aims to analyze the dynamics of the relationship between oil price fluctuations and Iraqi financial markets during the period (2000–2025), using the Vector Error Correction Model (VECM), in light of the Iraqi economy’s heavy dependence on oil revenues and the impact of continuous changes in global oil prices on financial markets. The study adopted both the descriptive analytical and econometric approaches, using annual data on oil prices, Iraqi financial market indicators, exchange rates, and government expenditure. The Augmented Dickey-Fuller (ADF) test was used to examine the stationarity of time series data, in addition to Johansen’s cointegration test and the estimation of the VECM model to analyze the short-run and long-run relationships among the economic variables.

The results of the study showed a positive and statistically significant relationship between oil prices and Iraqi financial markets, as rising oil prices lead to improved financial market performance due to increased liquidity, improved government spending, and higher investment activity. The findings also indicated the existence of a long-run equilibrium relationship among the economic variables during the study period.

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Published
2026-08-27
Issue
Vol. 2 No. 2 (2026): Issue 2
Section
Economy
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Copyright (c) 2026 اسلام محمد محمود (المؤلف)

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

This is an open-access article distributed under the terms of the Creative Commons Attribution 4.0 International License (CC BY 4.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. Authors retain the copyright and full publishing rights without restrictions.

How to Cite

Dynamics of the Relationship Between Oil Price Fluctuations and Iraqi Financial Markets: An Econometric Study Using the VECM Model for the Period (2000–2025). (2026). Growth Leadership Journal, 2(2), 399-415. https://doi.org/10.61710/glj.v2i2.83

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