Indonesia Conference Directory

This study investigates whether oil price has significant effect to the financial soundness of firms in transportation sector of 6 ASEAN countries, which are Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam. In terms of operational activities, transportation sector is one of the most dependent sectors for oil usage. Therefore, oil price changes will create big impacts to the operational costs of transportation firms. Using panel data estimators, the researchers find that oil price change affects the financial soundness of transportation firms with return on equity as the mean of measurement. Furthermore, in addition to oil price change, researchers also find the effect of firm size and macroeconomic conditions to the financial soundness of transportation firms.