Energy import concentration, diversification, and welfare: evidence from Türkiye

Abstract

This thesis studies how supplier concentration heightens energy-supply risk and evaluates diversification as a policy response. Updated Herfindahl–Hirschman Index calculations reveal that Türkiye’s oil and natural-gas imports are far more concentrated than international benchmarks. A suite of stylised models is developed to determine optimal import shares under alternative shock scenarios. Across specifications, diversification consistently emerges as the welfare-maximising strategy. Historical case studies from the 1970s oil embargoes to the 2022 European gas crisis verify the model’s predictions, showing that countries delaying diversification suffered deeper and more prolonged output losses. An appendix offers a preliminary estimate of a hypothetical 2022 cut-off in Russian energy. The results underscore diversification as a first-order lever for reducing macroeconomic exposure to supply shocks and provide a tractable framework for future work.