Macroeconomic and sectoral effects of natural gas price: Policy insights from a macroeconometric model
研究利用宏观计量经济模型，分析沙特阿拉伯天然气价格变动对宏观经济和部门指标的影响，发现无缓解措施时价格上涨抑制非油部门，但有缓解措施时则促进整体经济增长。
Saudi Arabia has been implementing domestic energy price reforms to rationalize energy consumption and enhance the overall efficiency of its energy system. Since energy makes up one of the most significant building blocks in Saudi Arabia's economy, reforms in the energy sector will have implications on macroeconomic and sectoral developments. Natural gas played a key role in the Kingdom's industrial development. This paper utilizes a unique framework that first estimates the impacts of own price, a substitute fuel price, income, and utilization capacity on industrial natural gas demand in Saudi Arabia. The estimated equation is then incorporated into a macro-econometric model to simulate the effects of natural gas prices, a policy lever, on key macroeconomic and sectoral indicators across various scenarios. The results from the first stage show that industrial natural gas demand establishes a long-run relationship with its price, the price of heavy fuel oil (HFO), industrial income, and utilization capacity. The long-run elasticities of its own price and HFO price are estimated to be −0.41 and 0.08, respectively, while the income and utilization capacity elasticities are 0.37 and 0.55, respectively. Any deviations from the long-run equilibrium caused by shocks are found to be temporary, whith 73% of them restored in the following year. For policymakers, it is important to understand how an increase in natural gas prices could impact the economy if implemented with or without mitigation measures . The model scenario analyses from the second stage reveal that increases in natural gas prices without mitigations positively affect oil refinery value-added, government revenues, and spending, but not non-oil sector activities and GDP, while non-oil employment and disposable income are marginally affected. If the price increases are implemented with mitigation measures, all economic activities, including non-oil ones, and fiscal indicators experience growth. In terms of per unit change, increases in industrial natural gas prices do not have large effects on the economy, regardless of whether the effect is positive or negative.