We gathered data from different resources and then finalize our presentation. The intention to upload this file is to help those guys who need some guidelines for preparing presentation. :)
VIP Independent Call Girls in Bandra West 🌹 9920725232 ( Call Me ) Mumbai Esc...
Impact of Oil Prices on the Economic Growth of Pakistan
1. PRESENTED BY :~
1 – Syed Ghazanfar -60911
2 – Sharjeel Mateen -60738
3 – Waleed Hafeez -60650
TEACHER NAME :~
Sir Naveed Wahid Awan
2.
3. Overview
Introduction
Objective of study
Data Collection/Methodology
Recent overview of crude oil
Reason for Decline in Oil Price
Oil Importing Countries
Oil Prices & Economy of Pakistan
Oil Prices & Major Consumers
Policy Implication
Conclusion
4. Introduction
Crude Oil, often called “black gold” is naturally occurring, unrefined petroleum product
composed of hydrocarbon deposits.
Trade of crude oil across the globe is one major factors in determining the G.D.P and
financial policies of various countries across the globe
Crude oil exporting countries prefer to sell it for higher prices because it helps them to
increase their foreign reserves to control inflation
Oil is a crucial economic input and Pakistan’s growth, production levels, and price
levels are affected significantly by oil price volatility.
5. Objective of Study
Analyze the relationship between oil price and real GDP growth of Pakistan
Analyze the relationship between oil prices and its impact on different
industries
Analyze the relationship between oil prices and its impact on Pakistan stock
market
6. Data Collection/Methodology
Data collected from different researches, Ministry of Finance, Fifty Year
Economy of Pakistan, World Development Indicators (WDI), different
volumes of Pakistan Economic Survey & State bank of Pakistan (SBP)
Data for oil price was retrieved from International Financial Statistics issued
by International Monetary Fund
We put this data in excel sheet & draw tables & graphs
7. Recent overview of crude oil
Oil prices fell sharply in the second half of 2014.
Four-year period of stability around $105 per barrel.
From June 2014, the global oil prices started a trend of downward shift.
From $115 per barrel it touched a low of $45 per barrel in Jan 2015.
This decline being the largest since the 2008 decline when prices fell from a whooping
$145.85 per barrel to $32 per barrel.
9. Reason for Decline in Oil Price
Technological shift from vertical to horizontal drilling in US led to it becoming a
producer from a consumer.
Major boom in shale gas production causes the production increase by 0.9 million
barrel per day.
Between July and Dec 2014 alone, the projected oil demand for 2015 is downwards by
0.8 million barrel per day.
The US is producing record amounts of oils plenty of supply out of OPEC and Russia.
But there’s not enough demand.
10. Oil Importing Countries
There are three main channels through which a decrease in the price of oil affects
oil importers.
The first is the effect of the increase in real income on consumption.
The second is the decrease in the cost of production of final goods, and in turn on
profit and investment.
The third is the effect on the rate of inflation.
11. Oil Prices & Economy of Pakistan
Pakistan is semi-industrial economy which is mainly in chemical, textile,
agriculture, food processing etc.
Pakistan has imported oil from Middle East.
Pakistan import crude oil and refines the oil locally for the consumption
Our economy totally depends on oil import to run its economic mechanism
Falling price of oil in international market should be seen as a blessing for a
country like Pakistan
12. Oil Prices & Economy of Pakistan
Declining prices encourages OGRA to issue new licenses to 13 new oil
marketing companies
It brings new investment in the Pakistan
Pakistan produced 80,800 barrels/day in 2013, it increases to 110,000
barrels/day in 2015
Increase in production help to cut the import for Pakistan
Reduced import bill helped to maintain the foreign reserve to reduce trade
deficits of Pakistan
14. Oil Prices & Economy of Pakistan
State Bank of Pakistan is enjoying fall in oil prices by saving foreign reserves
It is also reducing pressure on the declining value of the Pakistan’s Rupee
In February, IMF noticed GDP growth of 4.7% for Pakistan
It happens due to saving of $4billion saving in oil import bill
It help to control Inflation Rate & Foreign Reserves
16. Oil Prices & Economy of Pakistan
Pakistan is agricultural country and its agriculture contributes 24% of GDP
Falling oil prices also helped the farmers to pay less (40%) for the fuel and
electricity bills
NEPRA reduces the Rs3.24 per unit of electricity, It is a big relief for people
Decline in oil prices also influence the stock market of Pakistan especially for
the PSO
One major impact of decreasing oil will be reflected in CPI inflation
17. Oil Prices & Major Consumers
INDUSTRY IMPACT
Power Positive
Paints Positive
Chemical Positive
Autos Positive
Cement Positive
General industries Positive
E&P and OMC Negative
12%
36%
4%
48%
Major Oil Consumers
Indusrial Sector Energy Sector Residential Transport Sector
18. Policy Implication
Enhance the positive effects of oil prices in reducing inflation by speeding up price
pass through.
Put in place instruments to smooth the effects of price changes.
Reduce oil price subsidies or increase taxes – which is good in economic and
environmental terms
Reduce fiscal deficits
Introduce less monetary tightening than would have been the case without the oil price
decline
Reduce energy intensity or diversify trade and production to reduce the economy’s
dependence on volatile oil prices
19. Conclusion
Impact of Oil Prices influences the economy at two level, macro level and micro level.
At macro level it helped to reduce inflation, trade deficits (reduces import bill),
production cost of electricity, transportations fares and increase revenues generation
by increasing sales tax.
At micro level it increase the purchasing power of the households, reduced prices of
household commodities and cheaper electricity per unit rates for household
consumption.
Current fluctuation in price of crude oil has positive impact on the economy of
Pakistan.
Notes de l'éditeur
Inflation- The rate at which the general level of prices for goods and services is rising and purchasing power is falling.
The ruble or rouble is a unit of currency of various countries in Eastern Europe and is closely associated with the economy of Russia
Inflation- The rate at which the general level of prices for goods and services is rising and purchasing power is falling.
The ruble or rouble is a unit of currency of various countries in Eastern Europe and is closely associated with the economy of Russia