Long-Term Analysis of the Nonlinear Effect of Export Diversification on Energy Demand in OPEC Member Countries

In recent years, a group of researchers have shown that not only the quantitative growth of exports, but also its diversity can affect energy demand. On the one hand, export diversification can replace energy-efficient products and services with energy-intensive products, and on the other hand, it can lead to an increase in industrial production; Therefore, in the present study, the non-linear effect of export diversity on the energy demand of OPEC member countries was investigated using fully modified ordinary least squares (FMOLS) and dynamic ordinary least squares (DOLS) long-term regression models, during the period of 2004-2019. The results of the study show that increasing export diversity increases energy demand. In addition, the non-linear U-shaped relationship between export diversity and energy demand was confirmed in this study, and also, the coefficients obtained for oil prices are negative and significant and for real GDP, natural resource rent, urbanization and population are positive and significant.