The oil price change is one of the main sources of the economic growth fluctuation in exporting oil countries. So the evaluation of changing in oil price is very essential To prevent the economic crisis and to protect the economic constancy. Moreover, the emphasis of economic programs on determining a particular growth rate for GDP provides one more important reason to study the quantitative relationship between oil price changes and economic growth. In present research the effect of this change is analyzed on Iranian economic growth. In addition the effect on other variables such as investment expenditures, imports, non-oil export are considered. Applying a time series of yearly data from 1959 to 2007 and a VAR method, different results are observed in the short and long runs. The results show that in the long run the effect of oil price change has negative effect on GDP and oil export compared to its positive effect on private consumption and investment. In the short run, the effect of oil price change, on the all the variables are positive, other than non-oil export. Furthermore, the effect of oil price fluctuation on variables such as GDP, imports, private consumption, investment, and oil export are more pronounce. Key words: Oil price fluctuation, economic growth, VAR method
