Studying the causality relation between fluctuation of oil price and Economic growth in Petroleum Exporting Countries

Although oil is known as one of the most important sources of wealth in the world; and oil owner countries are expected to be successful in improving their economic growths; empirical experiences show something different. In fact if oil is supposed to be a contribution in economic growth in Petroleum Exporting Countries, the effect of oil price shocks must be observed on the growth of gross domestic product of these countries. This research investigates the causality relation between oil price and gross domestic product in main Petroleum Exporting Countries through Granger causality test. The result of research shows that in most Petroleum Exporting Countries, this causality relation is not clearly observable and in most cases oil price increment cannot be considered as the main factor for economic growth in these countries and they will have to look for other solutions to help them grow properly.