The Effect of the Global Oil Price on Value of the Petrochemical Industry in Iran with NARDL Approach

Assessing the value of petrochemical industries on the one hand as strategic industries in the provision of raw materials of other parts and on the other hand, given the high weight of the formation of the stock market in Tehran, it is important. This industry, while influencing developments in other markets, especially the oil market, which has a significant impact on other markets, in particular the financial market. The stock prices of the petrochemicals in the stock market are heavily dependent on the price of petrochemical products, as well as the high dependence on oil price changes on global markets. Therefore, the analysis of the relationship between petrochemical price and oil price requires an asymmetrical model. In this study, the effect of oil price on value of the petrochemical industry in asymmetric shape in 2008-2017 periods daily basis has been analyzed using model Shin et al (2014). For this purpose, a nonlinear autoregressive distributed lag (NARDL) approach has been used. The findings indicate that these industries could be the channel for transferring global oil price fluctuations to the total stock market in Tehran. In the short term, anonymity is confirmed by the impact of the oil price on the value of the petrochemical industry. As oil prices decline, the value of petrochemicals decreases, but with increasing oil prices there will not be an increase in the value of petrochemicals. In the long run, oil prices are .