Saad Sherida al-Kaabi, energy minister for Qatar, has announced that the nation will leave the Organisation of Petroleum Exporting Countries (OPEC) on 1st January 2019.
(Image via OPEC)
The country is one of the smallest producers within OPEC, but has been part of the organisation for over 57 years. The announcement was made just days before the group was due to meet in Vienna.
The minister claims that the withdrawal is not connected to national politics, but is intended to focus more resources to its export of gas.
However some have seen the move as a swipe at Saudi Arabia who, as the highest producer of oil, effectively lead the organisation. Following tensions between the regions that escalated to a blockade on Qatar in 2017, the decision to withdraw may be just the latest response against Saudi.
“We are not saying we are going to get out of the oil business, but it is controlled by an organisation managed by a country”, said the energy minister, adding that Qatar was unwilling “to put efforts and resources and time in an organisation that we are a very small player in, and I don’t have a say in what happens.”
(Image via BBC)
The decision may also suggest a signal of greater coordination with Iran, since the two countries share the North Field - the world’s largest gas field. Natural gas is growing in value globally, and currently Qatar is the world’s leading supplier, accounting for around 30% of global demand.
They aim to increase production from 77 million tons per year to 110 million tons per year. Conversely, Qatar’s oil production in 2018 is estimated to be around 600,000 - 650,000 barrels per day, making them OPEC’s 11th biggest producer.
“We don’t have great potential (in oil), we are very realistic. Our potential is gas.”
Whatever the reasoning for the decision, Qatar’s will remain a leading exporter of gas, and will continue to be able to increase oil production without OPEC constraints if they choose. How it will affect their export relations with the rest of the Middle East remains to be seen.
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