Oil price and profitability: evidence from Southeast Asian countries


Tleugaliyev A. Faizulayev A. Arslan M.
2025Inderscience Publishers

International Journal of Electronic Finance
2025#14Issue 167 - 82 pp.

The paper explores the influence of macroeconomic variables on the profitability of the aviation sector in the Southeast Asia region. The panel corrected standard errors (PCSE) regression model was employed for the period 2011-2019 on a sample of six countries (i.e., Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam). The results revealed the positive effect of an increase in inflation whereas increases in government expenditure, lending, interest rate, profit tax, and the 2014 year associated with the decline in global oil prices, exert a statistically negative influence on the financial performance of the aviation sector in Southeast Asia region. The effect of changes in oil prices and population growth, 2015-2016 years as the continuation of global oil prices decreases, is statistically insignificant. The paper contributes to the understanding of important economic factors affecting the financial performance of the aviation industry in Southeast Asian countries in light of the COVID-19 outbreak and for further development of the economic sector.

airlines , oil prices , panel corrected standard error , panel data , PCSE , profitability , return on assets , ROA

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Bang College of Business, KIMEP University, Kazakhstan
Open Polytechnic of New Zealand - Te Pūkenga, 3 Cleary Street Waterloo, Lower Hutt, 5011, New Zealand

Bang College of Business
Open Polytechnic of New Zealand - Te Pūkenga

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