The Effect of Crude Oil Prices on Inflation: Evidence from Jordan

The primary objective of this study is to assess how fluctuations in crude oil prices impact inflation in Jordan. Annual time series quarterly data from 2000 to 2021 are employed for this purpose. An autoregressive distributed lag (ARDL) model is utilized to assess this impact. The findings indicate the presence of both short-run and long-run effects of oil prices on inflation, as revealed by the ARDL-ECM (1, 0). Additionally, stability in the ARDL model coefficients for the long-run relationship between oil prices and inflation is affirmed by the CUSUM tests.-ECM (1,0) highlights the existence of short-term and long-term effects of oil prices on inflation.