Oil Price Shocks, Exchange Rate Fluctuations, Foreign Direct Investment Inflows, and Macroeconomic Stability: Evidence from Kazakhstan Using a Vector Autoregressive Approach

Authors

  • Altynai Turlybekova South Kazakhstan Pedagogical University named after Uzbekali Zhanibekov, Shymkent, Kazakhstan
  • Akmaral E. Sarsenova International Taraz University named after Sherkhan Murtaza, Taraz, Kazakhstan
  • Parida Baineyeva Zh.A. Tashenev University, Shymkent, Kazakhstan
  • Ainura N. Aitymbetova M.Auezov South Kazakhstan University, Shymkent, Kazakhstan
  • Saken Ualikhanovich Abdibekov Kazakh National Agrarian Research University, Almaty, Kazakhstan
  • Raikhan Musamatovna Tazhibayeva International University of Tourism and Hospitality, Turkestan, Kazakhstan
  • Daniyal Duisenbek Cardiff University Kazakhstan, Astana, Kazakhstan

DOI:

https://doi.org/10.32479/ijeep.21785

Keywords:

Oil Price Shocks, Real Effective Exchange Rate, Foreign Direct Investment, VAR Model, Kazakhstan

Abstract

This study investigates the interplay between oil price shocks, exchange rate movements, foreign direct investment (FDI) inflows, and gross domestic product (GDP) in Kazakhstan. Using quarterly data for 2010Q1-2024Q4, a Vector Autoregression (VAR) model is employed to capture short- and medium-term dynamics among these variables. Stationarity tests confirm that all series are integrated of order one, while lag selection criteria support a VAR(3) specification. The empirical results indicate that GDP remains largely self-driven in the short run, but its long-term variability is increasingly influenced by exchange rate fluctuations and oil prices. FDI inflows are initially persistent yet strongly shaped by oil market volatility, while the real effective exchange rate (REER) proves highly sensitive to external energy shocks. Oil prices, by contrast, remain mostly exogenous. These findings underscore Kazakhstan’s structural dependence on global oil markets and highlight the need for diversification, fiscal stabilization mechanisms, and improved exchange rate management to strengthen macroeconomic resilience.

Downloads

Published

2025-12-26

How to Cite

Turlybekova, A., Sarsenova, A. E., Baineyeva, P., Aitymbetova, A. N., Abdibekov, S. U., Tazhibayeva, R. M., & Duisenbek, D. (2025). Oil Price Shocks, Exchange Rate Fluctuations, Foreign Direct Investment Inflows, and Macroeconomic Stability: Evidence from Kazakhstan Using a Vector Autoregressive Approach. International Journal of Energy Economics and Policy, 16(1), 774–780. https://doi.org/10.32479/ijeep.21785

Issue

Vol. 16 No. 1 (2026)

Section

Articles

License

Submission of an article implies that the work described has not been published previously , that it is not under consideration for publication elsewhere, that its publication is approved by all authors and tacitly or explicitly by the responsible authorities where the work was carried out, and that, if accepted, will not be published elsewhere in the same form, without the written consent of the Publisher. The Editors reserve the right to edit or otherwise alter all contributions, but authors will receive proofs for approval before publication.