The Simultaneous Economic Impact of the Corona Virus and the Reduction of Oil Prices on OPEC Organization

Mosaad Mohamed Elgayish

doi:doi:10.11648/j.ijeee.20210601.11

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The Simultaneous Economic Impact of the Corona Virus and the Reduction of Oil Prices on OPEC Organization

Mosaad Mohamed Elgayish

Published in International Journal of Economy, Energy and Environment (Volume 6, Issue 1)

Received: 24 December 2020 Accepted: 6 January 2021 Published: 18 January 2021

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Abstract

The world’s impact coincided with two major events at the same time that had a major impact on the global economy without exception in the beginning of 2020, as there was a very large drop in oil prices at the level of the world, as this coincided with the emergence of the Corona virus, which affected the economy of all countries of the world without exception, and so it was the research problem is summarized in reaching the extent of the impact of the coincidence of a decrease in global oil prices with the existence of the Corona crisis on OPEC organization, and therefore the multiple regression model was relied upon, depending on the World Bank data, and the research concluded that 78.1% of the change in Y is due to The change in X4 and X3 and 21.9% of the changes due to other factors were not taken into account. It is noticed that 54.6% of the change in Y is due to the change in oil price X3 and 23.5% of the change in Y is due to the change in X4, and the research also found that it was the Corona pandemic Clear effects were reflected in the image of reducing oil demand as a result of the precautionary measures taken by the countries of the world to confront the Corona pandemic, especially with the prevention of air traffic, as well as the reduction of travel by land. Based on this, the research recommends that OPEC organization should prepare for the near future by developing flexible strategies and scenarios that take into account the sharp price fluctuations of oil, not fully relying on oil as a source of public revenues for some OPEC countries, and working on finding auxiliary factors as a source of income in addition to oil. Besides activating the role of a management for disease crises and pandemics, take their consequences into consideration, and follow scientific methods in facing their economic consequences.

Published in	International Journal of Economy, Energy and Environment (Volume 6, Issue 1)
DOI	10.11648/j.ijeee.20210601.11
Page(s)	1-10
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

The Economic Impact, Simultaneous, Corona Virus, Oil Prices, OPEC Organization

References

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[2]	Anika Labiba Islam & Ana Espinola - Arredondo2018, Do renewables affect the strategic behavior of OPEC? School of Economic Science, Washington University, Washington State University, pp. 1-4.
[3]	Boukasbah and others 2017, The Status of the Organization of Petroleum Exporting Countries (OPEC), in the global oil market, reality and prospects, Faculty of Economic Sciences, University of Martyr Hama Lakhdar in Wadi, Algeria, pp. 36, 95.
[4]	Clifford Ogbeide 2008, Opec’s Organization Structures, its strategic, aims & objectives, production, Quota in cohesion within 2008- Msc2540, pp. 5-10.
[5]	Ebghaei, Felor, 2007, Opec and its role in regulating price of petroleum, Hacetepe University, department of Economics, Ankara Turkey, MPRA paper No, 8015, posted 13 Jul. 2017, pp. 7-11.
[6]	Ehab Ismail, (2013), wind energy policies in thirty years have developed lessons learned from twelve wind energy markets, www.energyandeconomy.com, Egypt New and Renewable Energy Authority.
[7]	Geoffrey Heal and Karoline Hallmeyer, 2015, How lower oil prices impact the competitiveness of oil with renewable fuels, Columbia, SIAP, center on global energy policy, PP. 7-12.
[8]	IPCC (2012), Renewable Energy Sources and Climate Change Mitigation, Policy Makers Summary and Technical Summary, Reprinted with corrections in 2012, ISBN 978-92-9169-131-9 IPCC Special Report, p. 9.
[9]	Lopez-Corrdova, Ernesto. 2020, Digital Platforms and the Demand for international Tourism Services, World Bank Policy Research Working Paper WPS9147, P7.
[10]	Nashwi Mustafa 2014, The Impact of Global Economic Fluctuations on Oil Prices, College of Administration and Economics, King Saud University, p. 17 20.
[11]	OPEC Official website, https://www.opec.org/opec_web/en
[12]	OPEC Bulletin 2020, Monthly oil market report, 1010ViennamAustria, p. 3.
[13]	Official OPEC website www.opec.org/opec_web/en/data_graphs/330.htm.
[14]	Official World Bank website, https://data.albankaldawli.org/indicator/NY.GDP.PETR.RT.ZS.
[15]	U.s Energy information derived from data published in the October 2020, short term energy outlook, Oil & Gas Journal (ogj.com).
[16]	Pinar Deniz, 2019, oil price and renewable energy: oil dependent countries Marmara, university, department of economics, Istanbul, - Turkey, pp. 1-3.
[17]	Rabah Arezki, Hangwen, 2020, dealing with a Double Shock: The Coronavirus Pandemic and the Collapse of Oil Prices, World Bank, www.albankaldawly.org Covid 19 and Oil Price Collapse: Coping with a Dual Shock in the Gulf Cooperation Council Rabah Arezki, Rachel Yuting Fan and Ha Nguyen.
[18]	The Arab Center for Research and Policy Studies 2015, The implications of lower oil prices on the economies of the Middle East oil-exporting countries, Al-Dafna, Street 826, Area 66, Qatar, P. O. Box 10277, p. 28, 29.
[19]	The Arab Center for Research and Policy Studies 2017, OPEC's dilemma between market share and production limitation, Wadi Al-Banat, Al-Dhayin, Al-Tarfa Street, Area 70, Qatar, P. O. Box 10277, p. 13, p. 19.
[20]	Troster, Victor and Shahbaz, Muhammed and Uddinm, Gazi Salah, 2018, Renewable Energy, Oil Prices, and Economic Activity, A Granger-causality in Quintiles analysis, universities de les illes Balears, Spain, Montpellier Business School, France, Linkoping University, Sweden, MPRA. PP. 33.
[21]	https://www.statista.com/statistics/262858/change-in-opec-crude-oil-prices-since-1960, Johannes-Brahms-Platz, Statista, GmbH, 20355, Hamburg Germany.
[22]	International energy agency, Renewables Information, USA, https://www.iea.org/data-andstatistics.
[23]	https://energypost.eu, Energy post, 60 years on, Opec should take control again, cut supply, raise prices to fund its tractions, energy post.
[24]	www.cnbc.com/2020/04/01/5-charts-that-explain-the-saudi-arabia-russia-oil-price-war-so-far.html, U.s Energy information derived from data published in the April 2020, short term energy outlook, Oil & Gas Journal (ogj.com).

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APA Style

Mosaad Mohamed Elgayish. (2021). The Simultaneous Economic Impact of the Corona Virus and the Reduction of Oil Prices on OPEC Organization. International Journal of Economy, Energy and Environment, 6(1), 1-10. https://doi.org/10.11648/j.ijeee.20210601.11

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ACS Style

Mosaad Mohamed Elgayish. The Simultaneous Economic Impact of the Corona Virus and the Reduction of Oil Prices on OPEC Organization. Int. J. Econ. Energy Environ. 2021, 6(1), 1-10. doi: 10.11648/j.ijeee.20210601.11

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AMA Style

Mosaad Mohamed Elgayish. The Simultaneous Economic Impact of the Corona Virus and the Reduction of Oil Prices on OPEC Organization. Int J Econ Energy Environ. 2021;6(1):1-10. doi: 10.11648/j.ijeee.20210601.11

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@article{10.11648/j.ijeee.20210601.11,
  author = {Mosaad Mohamed Elgayish},
  title = {The Simultaneous Economic Impact of the Corona Virus and the Reduction of Oil Prices on OPEC Organization},
  journal = {International Journal of Economy, Energy and Environment},
  volume = {6},
  number = {1},
  pages = {1-10},
  doi = {10.11648/j.ijeee.20210601.11},
  url = {https://doi.org/10.11648/j.ijeee.20210601.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijeee.20210601.11},
  abstract = {The world’s impact coincided with two major events at the same time that had a major impact on the global economy without exception in the beginning of 2020, as there was a very large drop in oil prices at the level of the world, as this coincided with the emergence of the Corona virus, which affected the economy of all countries of the world without exception, and so it was the research problem is summarized in reaching the extent of the impact of the coincidence of a decrease in global oil prices with the existence of the Corona crisis on OPEC organization, and therefore the multiple regression model was relied upon, depending on the World Bank data, and the research concluded that 78.1% of the change in Y is due to The change in X4 and X3 and 21.9% of the changes due to other factors were not taken into account. It is noticed that 54.6% of the change in Y is due to the change in oil price X3 and 23.5% of the change in Y is due to the change in X4, and the research also found that it was the Corona pandemic Clear effects were reflected in the image of reducing oil demand as a result of the precautionary measures taken by the countries of the world to confront the Corona pandemic, especially with the prevention of air traffic, as well as the reduction of travel by land. Based on this, the research recommends that OPEC organization should prepare for the near future by developing flexible strategies and scenarios that take into account the sharp price fluctuations of oil, not fully relying on oil as a source of public revenues for some OPEC countries, and working on finding auxiliary factors as a source of income in addition to oil. Besides activating the role of a management for disease crises and pandemics, take their consequences into consideration, and follow scientific methods in facing their economic consequences.},
 year = {2021}
}

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TY  - JOUR
T1  - The Simultaneous Economic Impact of the Corona Virus and the Reduction of Oil Prices on OPEC Organization
AU  - Mosaad Mohamed Elgayish
Y1  - 2021/01/18
PY  - 2021
N1  - https://doi.org/10.11648/j.ijeee.20210601.11
DO  - 10.11648/j.ijeee.20210601.11
T2  - International Journal of Economy, Energy and Environment
JF  - International Journal of Economy, Energy and Environment
JO  - International Journal of Economy, Energy and Environment
SP  - 1
EP  - 10
PB  - Science Publishing Group
SN  - 2575-5021
UR  - https://doi.org/10.11648/j.ijeee.20210601.11
AB  - The world’s impact coincided with two major events at the same time that had a major impact on the global economy without exception in the beginning of 2020, as there was a very large drop in oil prices at the level of the world, as this coincided with the emergence of the Corona virus, which affected the economy of all countries of the world without exception, and so it was the research problem is summarized in reaching the extent of the impact of the coincidence of a decrease in global oil prices with the existence of the Corona crisis on OPEC organization, and therefore the multiple regression model was relied upon, depending on the World Bank data, and the research concluded that 78.1% of the change in Y is due to The change in X4 and X3 and 21.9% of the changes due to other factors were not taken into account. It is noticed that 54.6% of the change in Y is due to the change in oil price X3 and 23.5% of the change in Y is due to the change in X4, and the research also found that it was the Corona pandemic Clear effects were reflected in the image of reducing oil demand as a result of the precautionary measures taken by the countries of the world to confront the Corona pandemic, especially with the prevention of air traffic, as well as the reduction of travel by land. Based on this, the research recommends that OPEC organization should prepare for the near future by developing flexible strategies and scenarios that take into account the sharp price fluctuations of oil, not fully relying on oil as a source of public revenues for some OPEC countries, and working on finding auxiliary factors as a source of income in addition to oil. Besides activating the role of a management for disease crises and pandemics, take their consequences into consideration, and follow scientific methods in facing their economic consequences.
VL  - 6
IS  - 1
ER  -

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Author Information

Mosaad Mohamed Elgayish

Economics Department, Faculty of Politics &Economics, Beni-Suef University, Beni-Suef, Egypt

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Mosaad Mohamed Elgayish. (2021). The Simultaneous Economic Impact of the Corona Virus and the Reduction of Oil Prices on OPEC Organization. International Journal of Economy, Energy and Environment, 6(1), 1-10. https://doi.org/10.11648/j.ijeee.20210601.11

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ACS Style

Mosaad Mohamed Elgayish. The Simultaneous Economic Impact of the Corona Virus and the Reduction of Oil Prices on OPEC Organization. Int. J. Econ. Energy Environ. 2021, 6(1), 1-10. doi: 10.11648/j.ijeee.20210601.11

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AMA Style

Mosaad Mohamed Elgayish. The Simultaneous Economic Impact of the Corona Virus and the Reduction of Oil Prices on OPEC Organization. Int J Econ Energy Environ. 2021;6(1):1-10. doi: 10.11648/j.ijeee.20210601.11

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@article{10.11648/j.ijeee.20210601.11,
  author = {Mosaad Mohamed Elgayish},
  title = {The Simultaneous Economic Impact of the Corona Virus and the Reduction of Oil Prices on OPEC Organization},
  journal = {International Journal of Economy, Energy and Environment},
  volume = {6},
  number = {1},
  pages = {1-10},
  doi = {10.11648/j.ijeee.20210601.11},
  url = {https://doi.org/10.11648/j.ijeee.20210601.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijeee.20210601.11},
  abstract = {The world’s impact coincided with two major events at the same time that had a major impact on the global economy without exception in the beginning of 2020, as there was a very large drop in oil prices at the level of the world, as this coincided with the emergence of the Corona virus, which affected the economy of all countries of the world without exception, and so it was the research problem is summarized in reaching the extent of the impact of the coincidence of a decrease in global oil prices with the existence of the Corona crisis on OPEC organization, and therefore the multiple regression model was relied upon, depending on the World Bank data, and the research concluded that 78.1% of the change in Y is due to The change in X4 and X3 and 21.9% of the changes due to other factors were not taken into account. It is noticed that 54.6% of the change in Y is due to the change in oil price X3 and 23.5% of the change in Y is due to the change in X4, and the research also found that it was the Corona pandemic Clear effects were reflected in the image of reducing oil demand as a result of the precautionary measures taken by the countries of the world to confront the Corona pandemic, especially with the prevention of air traffic, as well as the reduction of travel by land. Based on this, the research recommends that OPEC organization should prepare for the near future by developing flexible strategies and scenarios that take into account the sharp price fluctuations of oil, not fully relying on oil as a source of public revenues for some OPEC countries, and working on finding auxiliary factors as a source of income in addition to oil. Besides activating the role of a management for disease crises and pandemics, take their consequences into consideration, and follow scientific methods in facing their economic consequences.},
 year = {2021}
}

Copy | Download

TY  - JOUR
T1  - The Simultaneous Economic Impact of the Corona Virus and the Reduction of Oil Prices on OPEC Organization
AU  - Mosaad Mohamed Elgayish
Y1  - 2021/01/18
PY  - 2021
N1  - https://doi.org/10.11648/j.ijeee.20210601.11
DO  - 10.11648/j.ijeee.20210601.11
T2  - International Journal of Economy, Energy and Environment
JF  - International Journal of Economy, Energy and Environment
JO  - International Journal of Economy, Energy and Environment
SP  - 1
EP  - 10
PB  - Science Publishing Group
SN  - 2575-5021
UR  - https://doi.org/10.11648/j.ijeee.20210601.11
AB  - The world’s impact coincided with two major events at the same time that had a major impact on the global economy without exception in the beginning of 2020, as there was a very large drop in oil prices at the level of the world, as this coincided with the emergence of the Corona virus, which affected the economy of all countries of the world without exception, and so it was the research problem is summarized in reaching the extent of the impact of the coincidence of a decrease in global oil prices with the existence of the Corona crisis on OPEC organization, and therefore the multiple regression model was relied upon, depending on the World Bank data, and the research concluded that 78.1% of the change in Y is due to The change in X4 and X3 and 21.9% of the changes due to other factors were not taken into account. It is noticed that 54.6% of the change in Y is due to the change in oil price X3 and 23.5% of the change in Y is due to the change in X4, and the research also found that it was the Corona pandemic Clear effects were reflected in the image of reducing oil demand as a result of the precautionary measures taken by the countries of the world to confront the Corona pandemic, especially with the prevention of air traffic, as well as the reduction of travel by land. Based on this, the research recommends that OPEC organization should prepare for the near future by developing flexible strategies and scenarios that take into account the sharp price fluctuations of oil, not fully relying on oil as a source of public revenues for some OPEC countries, and working on finding auxiliary factors as a source of income in addition to oil. Besides activating the role of a management for disease crises and pandemics, take their consequences into consideration, and follow scientific methods in facing their economic consequences.
VL  - 6
IS  - 1
ER  -

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