The Link between Crude Palm Oil and Crude Oil Price in Various Periods of the Biodiesel Mandatory Policy in Indonesia
The biodiesel policy brought changes in the analysis of crude palm oil (CPO) prices. Supply and demand are no longer the main factors, but the correlation between CPO and crude oil prices. The main objective of this study is to provide an empirical study of the relationship between CPO and Indonesia...
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| Format: | Article |
| Language: | English |
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Jurusan Ekonomi Pembangunan Fakultas Ekonomi Universitas Sriwijaya
2023-01-01
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| Series: | Jurnal Ekonomi Pembangunan |
| Subjects: | |
| Online Access: | https://ejournal.unsri.ac.id/index.php/jep/article/view/18475 |
| _version_ | 1797952232179630080 |
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| author | Nency Febrina Limbong Alin Halimatussadiah |
| author_facet | Nency Febrina Limbong Alin Halimatussadiah |
| author_sort | Nency Febrina Limbong |
| collection | DOAJ |
| description | The biodiesel policy brought changes in the analysis of crude palm oil (CPO) prices. Supply and demand are no longer the main factors, but the correlation between CPO and crude oil prices. The main objective of this study is to provide an empirical study of the relationship between CPO and Indonesian Crude oil Price (ICP) in various periods of mandatory biodiesel policy in Indonesia. Using the Ordinary Least Square (OLS) method of time series data from 2001-2021, this study shows that in general CPO and ICP are positively and significantly correlated, but the price link is very dependent on the biodiesel policy that is implemented. ICP and CPO are positively and significantly correlated in the biodiesel mandatory period with limited subsidies (2006-2015) and in the biodiesel mandatory period with incentives which combined with progressive CPO export levies tariff (2020-2021). ICP and CPO are not correlated during the mandatory biodiesel period, combined with incentives and a fixed CPO export levy tariff (2016-2019). When CPO and ICP prices are strongly and significantly correlated, stock increases are not associated with a decrease in CPO prices. However, when the CPO and ICP prices are not significantly correlated, the stock increase is followed by a decrease in the CPO price. CPO price stabilization only occurs during the biodiesel mandatory period, combined with incentives and a fixed CPO export levy tariff. |
| first_indexed | 2024-04-10T22:42:48Z |
| format | Article |
| id | doaj.art-b6d645b5aadc497c96b6b554e393bae2 |
| institution | Directory Open Access Journal |
| issn | 1829-5843 2685-0788 |
| language | English |
| last_indexed | 2024-04-10T22:42:48Z |
| publishDate | 2023-01-01 |
| publisher | Jurusan Ekonomi Pembangunan Fakultas Ekonomi Universitas Sriwijaya |
| record_format | Article |
| series | Jurnal Ekonomi Pembangunan |
| spelling | doaj.art-b6d645b5aadc497c96b6b554e393bae22023-01-16T02:25:10ZengJurusan Ekonomi Pembangunan Fakultas Ekonomi Universitas SriwijayaJurnal Ekonomi Pembangunan1829-58432685-07882023-01-0120211512410.29259/jep.v20i2.184756764The Link between Crude Palm Oil and Crude Oil Price in Various Periods of the Biodiesel Mandatory Policy in IndonesiaNency Febrina Limbong0Alin Halimatussadiah1Faculty of Economics and Business, Universitas IndonesiaFaculty of Economics and Business, Universitas IndonesiaThe biodiesel policy brought changes in the analysis of crude palm oil (CPO) prices. Supply and demand are no longer the main factors, but the correlation between CPO and crude oil prices. The main objective of this study is to provide an empirical study of the relationship between CPO and Indonesian Crude oil Price (ICP) in various periods of mandatory biodiesel policy in Indonesia. Using the Ordinary Least Square (OLS) method of time series data from 2001-2021, this study shows that in general CPO and ICP are positively and significantly correlated, but the price link is very dependent on the biodiesel policy that is implemented. ICP and CPO are positively and significantly correlated in the biodiesel mandatory period with limited subsidies (2006-2015) and in the biodiesel mandatory period with incentives which combined with progressive CPO export levies tariff (2020-2021). ICP and CPO are not correlated during the mandatory biodiesel period, combined with incentives and a fixed CPO export levy tariff (2016-2019). When CPO and ICP prices are strongly and significantly correlated, stock increases are not associated with a decrease in CPO prices. However, when the CPO and ICP prices are not significantly correlated, the stock increase is followed by a decrease in the CPO price. CPO price stabilization only occurs during the biodiesel mandatory period, combined with incentives and a fixed CPO export levy tariff.https://ejournal.unsri.ac.id/index.php/jep/article/view/18475biodiesel, palm oil, cpo, crude oil, mandatory policy |
| spellingShingle | Nency Febrina Limbong Alin Halimatussadiah The Link between Crude Palm Oil and Crude Oil Price in Various Periods of the Biodiesel Mandatory Policy in Indonesia Jurnal Ekonomi Pembangunan biodiesel, palm oil, cpo, crude oil, mandatory policy |
| title | The Link between Crude Palm Oil and Crude Oil Price in Various Periods of the Biodiesel Mandatory Policy in Indonesia |
| title_full | The Link between Crude Palm Oil and Crude Oil Price in Various Periods of the Biodiesel Mandatory Policy in Indonesia |
| title_fullStr | The Link between Crude Palm Oil and Crude Oil Price in Various Periods of the Biodiesel Mandatory Policy in Indonesia |
| title_full_unstemmed | The Link between Crude Palm Oil and Crude Oil Price in Various Periods of the Biodiesel Mandatory Policy in Indonesia |
| title_short | The Link between Crude Palm Oil and Crude Oil Price in Various Periods of the Biodiesel Mandatory Policy in Indonesia |
| title_sort | link between crude palm oil and crude oil price in various periods of the biodiesel mandatory policy in indonesia |
| topic | biodiesel, palm oil, cpo, crude oil, mandatory policy |
| url | https://ejournal.unsri.ac.id/index.php/jep/article/view/18475 |
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