Energy Consumption, Economic Growth, and CO2 Emissions in GCC Countries: Panel Evidence and the Environmental Kuznets Curve

The Gulf Cooperation Council (GCC) countries consistently rank among the highest per capita CO2 emitters globally, yet rigorous empirical analysis of the structural drivers of these emissions in the post-Paris Agreement era remains scarce. This study investigates the determinants of CO2 emissions per capita across six GCC economies—Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates—over the period 2015–2022, using pooled ordinary least squares (OLSs) and country fixed effects (FEs) panel regression models with country-clustered standard errors. The focal explanatory variable is energy use per capita, complemented by GDP per capita, trade openness, urbanization, foreign direct investment (FDI), and industry value added as controls. A quadratic income term explicitly tests the environmental Kuznets curve (EKC) hypothesis. Results consistently show that energy use is the dominant driver of emissions. The EKC hypothesis is supported in the FE framework. The implied turning point of approximately USD 85,500 per capita (constant 2015 USD) is already exceeded by Qatar (panel mean: USD 114,835) and approached by the UAE (USD 71,434), while Bahrain (USD 55,681), Kuwait (USD 51,531), Saudi Arabia (USD 61,232), and Oman (USD 38,591) remain on the EKC’s rising slope, consistent with their continued emissions’ growth trajectories. Urbanization exerts a significant positive within-country effect on emissions. Trade openness reduces emissions in cross-sectional specifications, while FDI is systematically insignificant. These findings support energy efficiency reforms, renewable energy expansion, and low-carbon urban planning as the most effective policy levers for GCC decarbonization.