Investigating the effect of crude oil price on investment in renewable energy production in selected oil-producing countries

Subject Areas : Industrial Economics

Vida Varahrami ¹

1 - Associate Professor, Department of Economics, Shahid Beheshti university, Tehran, Iran (Crossponding Authur), [e-mail]

Received: 2025-06-25 Accepted : 2025-07-16 Published : 2025-10-23

Keywords: Investment, Renewable Energy, Oil Price JEL Classification: E56, Q32, E52,

Abstract :

Pollution from fossil fuels and the consequent challenges of global warming have accelerated the global shift toward renewable energy, prompting many countries to prioritize sustainable development and environmentally friendly energy sources. This study examines the effect of crude oil prices on investment in renewable energy production in selected oil-producing countries, using panel data from 2015 to 2024. The results indicate that oil prices significantly influence renewable energy investment, reflecting the dependence of oil-producing economies on oil revenues and their sensitivity to price fluctuations. The positive coefficient of crude oil prices suggests that these countries invest in renewable energy alongside oil exports. In addition, financial credits and research and development (R&D) spending both exhibit positive effects on renewable energy investment, underscoring the importance of financial resources and technological innovation. Based on these findings, the study recommends that revenues from oil sales be strategically allocated to renewable energy projects to support sustainable energy transitions in oil-producing countries.

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