Oil Spill(over)s : Linkages in Petroleum Product Pricing Policies in West African Countries

This paper addresses a number of issues regarding petroleum product pricing in Western Africaemphasizing international spillovers. We use panel unit root rests and long-run modeling based on vector error correction models to assess links and convergence in petroleum product prices across countries. Our results indicate that in general over the long-run there is convergence in prices across the countries. The estimation results for gasoline and diesel prices suggest the presence of long-run links between retail prices among the different country groupings with long-run multipliers ranging from 11 to -6.66. The speed of Adjustment to equilibrium varies significantly according to the countrygroupings considered. In contrast, the econometric results for kerosene prices not only indicate a weaker link between prices across countries, but also a much slower adjustment to equilibrium. Inlight of these important spillovers, the need to better coordinate pricing s and tax policies towards petroleum products at the regional level becomes apparent.
Publication date: May 2011
ISBN: 9781455260379
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Economics- Macroeconomics , Economics / General , International - Economics , petroleum products , gasoline prices , statistic , petroleum product prices , probability , probabilities , petroleum prices , equation , oil producing , petroleum product pricing , statistical significance , econometric results , oil producing countries , fuel prices , energy infor

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