Oil Production and Its Contribution to the Economic Growth of Algeria

For the last three decades, oil has been a major source of revenue, energy and foreign exchange for the Algerian economy. As one of the major oil supplier in the world, Algeria has been relying on oil to enhance its economic growth. In light of this background, this study aims to examine the relationship between oil production and the economic growth of Algeria. One of the major findings of this study is that oil production has been contributing to the economics growth of Algeria. Another finding of the study is that domestic oil consumption contributes more significantly to the Real GDP than oil export. One of the main concerns of this study is the possibility that the Algerian economic situation bear resemblance to the “Dutch disease” symptoms. One suggestion is that revenue and foreign exchange of Algeria must be diversified to include other sectors like: industries, agriculture, tourism, education, and services.