Regression Data

OILD OILS CPI PRI INT DINC

2.90109367 6.45199797 9.052132 17.29975007 8.942066571 19.13970861
2.77394228 13.06139591 11.79127 17.47239172 8.972543188 16.78351254
2.659473127 10.0570845 9.509041 18.68513546 9.849950714 17.97089953
2.574855068 8.696474174 9.973665 19.23541737 10.09271283 18.21489362
2.528518489 12.88933256 12.36819 17.97061567 9.610634525 17.50286976
2.506544692 13.87464364 12.34358 17.03420615 8.722551103 17.22060193
2.495445188 8.373609998 10.37381 17.37707253 9.108973655 17.47546073
2.473607424 13.38351463 11.37549 16.34299876 9.505491881 15.82428452
2.429005127 7.526036899 6.228004 15.04468834 9.764697183 16.194612
2.353988751 5.862286179 4.142637 13.9313887 7.879990975 15.80367951
2.262172191 24.89115055 4.366665 15.87538887 10.31723857 13.88616274
2.169127505 7.891155227 3.148261 15.66139881 10.05011315 12.71038342
2.093909912 2.463092886 3.290345 15.28016774 11.14984456 13.90337089
2.04446758 4.43839749 2.914135 15.10431024 11.18013441 14.38938988
2.02780804 7.749247241 7.444625 14.97801645 10.92997529 13.49121899
2.034422006 7.026466698 9.063327 17.46123178 13.11465523 12.9985898
2.044604691 19.05220125 7.921084 17.73199402 13.5002848 12.43167124
2.051014965 7.274319326 7.598684 17.18706472 12.63297656 13.58219768
2.062431388 13.20400982 20.28612 17.60584829 12.82071095 12.9288821
2.077630164 20.66651581 13.64777 15.94948282 11.66271342 13.51244387
2.093541936 10.85023582 13.88114 14.20455753 10.47897639 13.80200815
2.109817506 19.64465505 11.91677 12.52062765 9.289527939 12.23372276
2.120847369 5.968574381 9.685053 13.4759584 9.729124785 12.65434365
2.119741418 6.964041132 7.689504 13.3613054 9.840955332 14.45063487
2.103437242 6.948417085 7.191671 13.38356113 10.02646834 11.70823855
Regression Results
Regression Equation
OIL DEMAND=B0+B1X1+ B2X2+ B2X3+ B4X4+ B5X5

OIL DEMAND =0.0771+2.5100-0.0005+0.0001-0.0006-0.0003

Table1: Regression results

Coefficients Standard Error t-Stat P-value

Intercept 0.0771 0.030259 2.551055 0.022152

OILS 2.5100 0.000208 0.12059 0.905616

CPI -0.0005 0.000353 -1.52894 0.147092

PRI -0.0001 0.001559 0.066562 0.94781

INT -0.0006 0.002212 -0.29954 0.768639

DINC -0.0003 0.001475 -0.20073 0.843602

Diagnostic Results

0.9997 __ 0.004771
R Square Standard Error

0.9996 __ 8071.159
Adjusted R Square F-Statistics

0.183686
Explained Sum of Mean Sum of
1.6535 __
Square Square
Hypothesis
H0: Oil demand depends on oil prices

H1: Oil demand does not depend on oil prices

Results Interpretation
There is a positive but statistically insignificant relationship between oil demand and oil prices

because the probability value (p-value) is greater than 0.1, both coefficient insignificantly

positively related with each other. The coefficient value of oil supply is (0.0771) it means that, if

oil supply increases by 1% the demand of oil will also increase by 7.71%. A statistical insignificant

negative relationship between consumer price index (Inflation) and oil demand shows that, both

variables are negatively related with each other. The coefficient value of consumer price index is

(-0.0005), which means that if inflation increase by 1% the oil demand will be decreased by 0.05%.

Oil prices is one of the most important determinant of oil demand and the relationship between

both variable is negative. It means that when oil price increases by 1% the oil demand will be

decreased by 0.01%. The both variables interest rate and disposable income also has a negative

relationship with oil demand. Disposable income (Income-Tax) and interest rate negatively related

with oil prices meaning that when both variables increases by one percent the oil demand will be

decreased by equal to their coefficient value.

R-Square

The R-squared of the regression is the fraction of the variation in your dependent variable that is

accounted for (or predicted by) independent variables. In regression with a single independent

variable, it is the same as the square of the correlation between your dependent and independent
variable. In (Table 1) the value of R-square is 0.9997, which means that the variation in depended

variable is 99.97% that is accounted by independent variable.

Explained Sum of Square, total Sum of Square and Residuals Sum of Square

The total sum square (TSS) meaning that the total variation in all variables and explained sum of

square (ESS) means that the how much the error is explained. The residuals sum of square(RSS)

measure of the amount of error remaining between the regression function and the data set. In

(Table 1) the value of explained sum of square is (1.6535), which tells us the variation in model.

F-Statistics

The F value is the ratio of the mean regression sum of squares divided by the mean error sum of

squares. The F-statistics value tells us whether the model as a whole has statistically significant.

In our analysis, the F-statistics value is (8071.159), which shows that model is statistically

significant.

Standard Error of the Coefficients

The standard error of the coefficient measures the standard deviation of the coefficient, the amount

it varies across variables. Interest rate standard error value as high as is (0.002212), which means

that the interest rate variation from means is 0.22%. Oil supply has a minimum variation from

means because its value is less than others variable which is (0.000208).

t-Statistics

The t-statistics value tells us the significant level of the coefficient, the should be greater than 1.96.

In table 1, the value of intercept is greater than 1.96 which means that it is statistically significant

and all other variables are statistically in significant.

Standard Error of the Regression

Standard error of the regression represents the average distance that the observed values fall from

the regression line. Conveniently, it tells you how wrong the regression model is on average using

the units of the response variable. In table 1 the standard error of the regression value is (0.004771)

smaller values are better because it indicates that the observations are closer to the fitted line.

Question 5
 Forecasting Data

Stocks
GDP Imports of
Oil rents Official traded,
growth goods and
Years Countary (% of exchange Exports total
(annual services (%
GDP) rate Inflation, of goods value (%
%) of GDP)
(LCU per GDP and of GDP)
US$, deflator services
period (annual (% of
average) %) GDP)
Years Countary GDPG OILR EXCR INF IMPG EXPG STVL

2001 UAE 1.399085 13.33381 3.6725 -2.34931 40.70535 49.15923 2.610465

2002 UAE 2.433457 12.1884 3.6725 3.77084 43.56831 49.50335 2.22123
2003 UAE 8.800541 15.11651 3.6725 4.072407 46.37697 55.9232 0.778471
2004 UAE 9.566437 17.97834 3.6725 8.501422 53.05488 63.56779 2.885519
2005 UAE 4.855141 21.10207 3.6725 16.52602 51.96769 67.58543 15.13458
2006 UAE 9.83732 23.27444 3.6725 11.96243 50.84287 68.62783 9.088774
2007 UAE 3.18439 21.16274 3.6725 12.53396 64.41406 72.3841 18.45719
2008 UAE 3.191836 24.18189 3.6725 18.53335 69.64566 78.86789 22.54868
2009 UAE -5.24292 15.75853 3.6725 -15.183 73.80863 79.65332 25.95278
2010 UAE 1.635449 20.17781 3.6725 12.49018 79.03289 77.71304 9.56176
2011 UAE 6.35892 24.83325 3.6725 13.81538 81.6311 89.7198 4.275865
2012 UAE 5.104679 24.83727 3.6725 1.625947 85.31346 100.2615 4.789479
2013 UAE 5.789906 24.04403 3.6725 -1.53644 85.22885 100.5491 5.497841
2014 UAE 3.284926 21.36983 3.6725 -0.0136 89.02285 99.10015 35.73048
2015 UAE 3.828867 11.20584 3.6725 -14.4962 96.02391 100.4056 16.09121
2016 UAE 3.03646 26.97275 3.6725 -5.44304 101.4398 103.8212 14.19346
 Moving Average Forecasting

Years GDPG Forecast OILR Forecast EXCR Forecast INF Fastorec IMPG Forecast EXPG Forecast STVL Forecast
2001 1.399085 13.33381 3.6725 -2.34931 40.70535 49.15923 2.610465
2002 2.433457 12.1884 3.6725 3.77084 43.56831 49.50335 2.22123
2003 8.800541 15.11651 3.6725 4.072407 46.37697 55.9232 0.778471
2004 9.566437 17.97834 3.6725 8.501422 53.05488 63.56779 2.885519
2005 4.855141 21.10207 3.6725 16.52602 51.96769 67.58543 15.13458
2006 9.83732 5.410932098 23.27444 15.94383 3.6725 3.6725 11.96243 6.104276 50.84287 47.13464 68.62783 57.1478 9.088774 4.726052
2007 3.18439 7.098579046 21.16274 17.93195 3.6725 3.6725 12.53396 8.966623 64.41406 49.16215 72.3841 61.04152 18.45719 6.021714
2008 3.191836 7.248765719 24.18189 19.72682 3.6725 3.6725 18.53335 10.71925 69.64566 53.33129 78.86789 65.61767 22.54868 9.268907
2009 -5.24292 6.127024811 15.75853 21.5399 3.6725 3.6725 -15.183 13.61144 73.80863 57.98503 79.65332 70.20661 25.95278 13.62295
2010 1.635449 3.165153103 20.17781 21.09594 3.6725 3.6725 12.49018 8.874556 79.03289 62.13578 77.71304 73.42371 9.56176 18.2364
2011 6.35892 2.521214674 24.83325 20.91108 3.6725 3.6725 13.81538 8.067388 81.6311 67.54882 89.7198 75.44923 4.275865 17.12184
2012 5.104679 1.82553476 24.83727 21.22285 3.6725 3.6725 1.625947 8.437977 85.31346 73.70647 100.2615 79.66763 4.789479 16.15926
2013 5.789906 2.209592611 24.04403 21.95775 3.6725 3.6725 -1.53644 6.256374 85.22885 77.88635 100.5491 85.2431 5.497841 13.42571
2014 3.284926 2.72920657 21.36983 21.93018 3.6725 3.6725 -0.0136 2.242415 89.02285 81.00299 99.10015 89.57935 35.73048 10.01554
2015 3.828867 4.434776178 11.20584 23.05244 3.6725 3.6725 -14.4962 5.276291 96.02391 84.04583 100.4056 93.46872 16.09121 11.97109
2016 3.03646 4.873459778 26.97275 21.25804 3.6725 3.6725 -5.44304 -0.12099 101.4398 87.44403 103.8212 98.00722 14.19346 13.27697
Five years Ahead Forecasting (GDP)

Lower
Confidence
Forecast(GDP Bound(GDP Upper Confidence
GDP growth growth (annual growth (annual Bound(GDP growth
Years (annual %) %)) %)) (annual %))
2001 1.39908503
2002 2.43345681
2003 8.800540815
2004 9.566436637
2005 4.855141196
2006 9.837319773
2007 3.184390174
2008 3.191836276
2009 -5.242921907
2010 1.635449053
2011 6.358920203
2012 5.104679428
2013 5.78990607
2014 3.284926133
2015 3.828867056
2016 3.036459796 3.036459796 3.04 3.04
2017 2.920139359 -5.18 11.02
2018 2.826387745 -5.34 11.00
2019 2.732636132 -5.50 10.97
2020 2.638884518 -5.66 10.94
GDP Graph

12
10
8
6
4
2
0
-2
-4
-6
-8
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

GDP growth (annual %)

Forecast(GDP growth (annual %))
Lower Confidence Bound(GDP growth (annual %))
Upper Confidence Bound(GDP growth (annual %))
Five years Ahead Forecasting OIL Rent)

Forecast(Oil Lower Confidence Upper Confidence

Oil rents (% of rents (% of Bound(Oil rents Bound(Oil rents (%
Years GDP) GDP)) (% of GDP)) of GDP))
2001 13.33381089
2002 12.18839961
2003 15.11650935
2004 17.97833873
2005 21.10207464
2006 23.27444467
2007 21.16274214
2008 24.18189381
2009 15.75853483
2010 20.17780695
2011 24.83325469
2012 24.83726815
2013 24.04403394
2014 21.36982796
2015 11.20583639
2016 26.97274616 26.97274616 26.97 26.97
2017 22.93098619 13.36 32.51
2018 23.43080883 12.72 34.14
2019 23.93063146 12.19 35.67
2020 24.4304541 11.74 37.12
 Oil Rent Graph

40

35

30

25

20

15

10

0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Oil rents (% of GDP) Forecast(Oil rents (% of GDP))

Lower Confidence Bound(Oil rents (% of GDP)) Upper Confidence Bound(Oil rents (% of GDP))
 Five years Ahead Forecasting (Official Exchange Rate)

Official Lower Confidence Upper Confidence

exchange rate Forecast(Official Bound(Official Bound(Official
(LCU per US$, exchange rate (LCU exchange rate (LCU exchange rate (LCU
period per US$, period per US$, period per US$, period
Years average) average)) average)) average))
2001 3.6725
2002 3.6725
2003 3.6725
2004 3.6725
2005 3.6725
2006 3.6725
2007 3.6725
2008 3.6725
2009 3.6725
2010 3.6725
2011 3.6725
2012 3.6725
2013 3.6725
2014 3.6725
2015 3.6725
2016 3.6725 3.6725 3.67 3.67
2017 3.6725 3.67 3.67
2018 3.6725 3.67 3.67
2019 3.6725 3.67 3.67
2020 3.6725 3.67 3.67
2021 3.6725 3.67 3.67
2022 3.6725 3.67 3.67
3.6787433

3.671031
2001200220032004200520062007200820092010201120122013201420152016201720182019202020212022

Official exchange rate (LCU per US$, period average)

Forecast(Official exchange rate (LCU per US$, period average))
Lower Confidence Bound(Official exchange rate (LCU per US$, period average))
Upper Confidence Bound(Official exchange rate (LCU per US$, period average))