This paper empirically investigates the impact of fluctuations of crude oil prices on the financial performance of the 200 largest oil and gas companies which are listed on the US stock exchange for the period ranging from 1990-2008. The empirical results provide evidence that an increase in crude oil price positively influences the performance of oil and gas firms. Results from the panel data regression analysis show a statistically significant relationship (at 1% level) between the oil and gas index, return on equity (ROE), the return on asset (ROA), earning before interest, tax, depreciation and amortization (EBITDATA), and net-income (NI).
