Factors influencing the Fuel Oil Consumption in Malaysia: an ARDL approach

Hanis Jazilah Mohamad Jalaluddin

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Type :	Final Year Project
Subject :	HG Finance
Main Author :	Hanis Jazilah Mohamad Jalaluddin
Title :	Factors influencing the Fuel Oil Consumption in Malaysia: an ARDL approach
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Place of Production :	Tanjong Malim
Publisher :	Fakulti Pengurusan dan Ekonomi
Year of Publication :	2025
Corporate Name :	Perpustakaan Tuanku Bainun
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Abstract : Perpustakaan Tuanku Bainun

This study investigates the factors influencing Fuel Oil Consumption (FOC) in Malaysia, focusing on Gross Domestic Product (GDP), Population (POP), and Fuel Oil Prices (FOP) over the period from 1980 to 2023. Utilizing the Autoregressive Distributed Lag (ARDL) model, the research explores both short-term and long-term relationships between these variables. The findings reveal that FOP plays a critical role in determining FOC, exhibiting a significant negative relationship in the long term, while GDP and POP demonstrate limited influence. This suggests that Malaysia_s FOC is more sensitive to pricing mechanisms than to economic growth or demographic changes. Additionally, the analysis highlights a moderate speed of adjustment to equilibrium after disruptions, reflecting the resilience of Malaysia_s energy market but also underscoring its vulnerabilities to global oil price volatility. These results emphasize the importance of dynamic pricing strategies, energy diversification, and efficiency improvements in shaping a sustainable energy future for Malaysia. The study provides key insights for policymakers and researchers in formulating evidence-based strategies to balance energy demand with sustainable economic growth.

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