The effects of oil price changes on inflation and output in Greece

Thumbnail Image
Θανόπουλος, Βασίλειος
Journal Title
Journal ISSN
Volume Title
This thesis refers to the effect of oil price fluctuations on the economy with an emphasis on its different sectors. Emphasis is placed on the macroeconomic level, therefore, reference is made to supply and demand, inflation, GDP levels and employment. The research includes a literature review, and empirical results from Greek data. In this context, an initial theoretical analysis of the main themes of the paper was made and then the key terms of the study inflation as a phenomenon and the oil production industry were analysed. The study methodology was then explained, and the data analysis was presented. The 26 articles that were the focus of the study were then analysed and through their analysis it emerged that, basically, fluctuations in oil prices are positively associated with the increase in inflation and interest rates and negatively with demand and economic growth. However, the research also showed that fluctuations in oil prices do not always cause crises, nor are they the essential cause of them. Rather, it is the structural, systemic and economic problems that make a particular state vulnerable to crises. Thus, the causes and consequences of oil price fluctuations can be common and their limits difficult to identify, creating a vicious circle. One solution for Greece and nations around the world is to reduce dependence on crude oil and invest in renewable energy sources.
Oil prices, Inflation, Output, Supply, Demand, HICP, Energy sector