OIL PRICE, OIL PRODUCTION AND MACRO ECONOMIC PERFOMANCE IN NIGERIA

Abstract

This study examines the impact of oil price and oil production change on the macroeconomic performance of Nigeria. Oil price (OILP), Oil production (OILPD) and Real exchange rate (REXCH) were used as independent variables and Gross Domestic Product (GDPGR) was used to capture macro economic performance. The Vector Error Correction Model was one of the statistical techniques used on data collected on the dependent and independent variable. The findings showed that GDPGR was notably susceptible to fluctuations in oil prices and oil production causing a significant negative impact on macro economic performance in Nigeria for the period under review. The findings supported the recommendation that the Nigerian government should strengthen her crude oil refining capacity so that an increase will boost oil production and export earnings