Oil Prices, Stock Markets and Firm Performance: Evidence from Europe

Abstract

This paper extends understanding of the relationship between oil prices, stock markets and financial performance of oil and gas firms over the past decade. Firstly, it studies the impact of oil price fluctuations on stock markets in Europe. Secondly, it examines volatility spill-overs between oil and European stock markets. As oil price changes do not equally affect all industries, the study conducts both market-level and sector-level analyses. Thirdly, it examines the impact of crude oil price changes on the financial performance measure of oil and gas firms, both listed and unlisted, from the Western European region.