Studying the Impact of Oil Consumption on Economic Growth in Syria during the Period 1980-2023

Abstract

This study aims to examine the impact of oil consumption on economic growth in Syria during the period 1980–2023, taking into account structural breaks. To achieve this objective, the Autoregressive Distributed Lag (ARDL) model was applied to annual data, incorporating a dummy variable to represent the structural break in 2012.

The results reveal a strong positive long-run effect of oil consumption on real GDP growth. This underscores the pivotal role of oil consumption as both an intermediate production input and a key final consumption good in the Syrian economy. In contrast, oil consumption (COC) did not show a statistically significant effect on real GDP growth in the short run. Meanwhile, the dummy variable for the structural break in 2012 exhibited a significant negative impact on real GDP growth in the long run, reflecting the severe economic contraction primarily associated with the economic crisis and the disruption of domestic oil supply chains during this period.

The study recommends rehabilitating the oil sector, along with diversifying the Syrian economy and its sources of production and energy, to achieve sustainable recovery. This should include a gradual shift toward renewable energy, given its advantages in terms of cost and efficiency.