The purpose of this article is to study the effects of oil on foreign direct investment attraction in oil exporting countries. We analyzed this effect by considering the required variables in the form of panel data model in these countries over the period from 1985 to 2008. First, the stationarity of variables was analyzed by four different tests, in which all variables were stationary in first-order difference and the Hausman test indicated that we should apply the fixed-effects model. Finally, the results have shown that, not only oil and the oil price have any positive effect on FDI attraction, but also, they cause the decrease of this attraction. Instead, the variables such as GDP, infrastructure and business have positive effect on FDI.

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