Published: Mon, December 03, 2018
Finance | By Loren Pratt

Qatar to leave OPEC in 2019, energy minister says

Qatar to leave OPEC in 2019, energy minister says

The surprise announcement from Qatar's minister of state for energy affairs, Saad Sherida al-Kaabi, again throws into question the role of the cartel after needing non-members to push through a production cut in 2016 after prices crashed below Dollars 30 a barrel.

The tiny, energy-rich Gulf Arab nation of Qatar says it will withdraw from OPEC, the Organisation of the Petroleum Exporting Countries, in January.

Speaking at a news conference in Doha, al-Kaabi said "the withdrawal decision reflects Qatar's desire to focus its efforts on plans to develop and increase its natural gas production from 77 million tons per year to 110 million tons in the coming years".

Oil prices soared on Monday after Russian Federation and Saudi Arabia renewed an agreement to cap output, while the USA agreed to halt raising tariffs on Chinese imports, stalling a trade row that many feared could hit demand for the commodity.

One Opec source told Reuters the decision was more symbolic than anything else.


Qatar has oil output of only 600,000 barrels per day (bpd), compared with the 11 million bpd produced by Saudi Arabia, the group's biggest oil producer and world's biggest exporter.

The announcement came ahead of December 6 meeting of OPEC.

Naeem Aslam, an analyst at online broker ThinkMarkets, said: "Qatar leaving Opec isn't great news for the oil market and the market participants haven't digested the full impact of this news". "A lot of people will politicise it", Al-Kaabi said.

In a statement, al-Kaabi said Qatar, the world's largest exporter of liquified natural gas, planned to increase its exports from 77 million tons of gas per year to 110 million tons. "If you aren't on board with a tough decision like to reduce, and Qatar was never in that position since it is a relatively small producer", she said, then you have no sway. Basically, Qataris have brought the biggest weapon out and it only means more instability between the Qatari and Saudi relationship.

Like this: