This study theoretically and empirically set out to investigate the Deregulation of the Nigerian Oil sector and its economic growth. Theoretical and conceptual propositions of the Benign Perspective of Natural resource abundance beneficial to growth revealed that the oil sector affects the country’s economic growth and various economic policies of subsidy and deregulation in this sector certainly affects the economy. Variables of the oil sector such as exchange rate, foreign direct investment, global oil price, inflation rate, oil price, oil production and oil revenue were used to determine the extent of implication the oil sector has on the country’s economic growth. The research work used annual secondary data on these variables beginning from 1980 to 2013. In achieving the objectives of the study, a long run approach of econometric analysis was employed using the trend analysis to examine movements and behaviours in the variables, the unit root test to test the stationarity of the variables, the Auto Regressive Distribution Lag test to test for the presence of long run relationship among the variables, Error Correction to model to show the rate at which short-run inconsistencies are being corrected and incorporated into the long-run equilibrium relationship and the Pairwise Granger Causality to examine the direction of causality among the variables.
