Qatar wants to withdraw from OPEC at the beginning of next year, as Qatar’s Energy Minister Saad Sharida al-Kaabi said on Monday that Qatar’s membership in OPEC will end in January 2019 and that it will inform the organization shortly before the announcement of the resolution.
The world’s largest oil producers, Saudi Arabia, Bahrain, the United Arab Emirates and Egypt stopped diplomatic ties with Qatar in the summer of 2017 and imposed a trade embargo on the Gulf state. This came because the countries accuse Qatar of supporting “terrorism” and maintaining close ties with Iran, Saudi Arabia’s arch rival in the region, but Doha rejects the allegations.
The withdrawal from OPEC reflects Qatar’s desire to focus on increasing gas production, Qatar Petroleum quoted the Energy Ministry as saying. In recent years, the country has been working unceasingly to develop a future growth strategy. Qatar wants to increase its gas output from 77 million tonnes to 110 million tonnes by 2024. The gas comes from the South Pars field off the coast of the emirate, the largest gas field in the world. Qatar is the world’s largest liquefied natural gas producer and supplies the world market with about 30% of the world’s total natural gas.
At the same time, oil prices rose sharply at the beginning of the week as Brent crude rose 5%, to more than $62. The price of WTI increased by $2.70, to $53.63. This is a clear shift in the slowdown that has been going on since the beginning of last October, at which the price of Brent fell from $85 to less than $60.
Experts attributed the price increase above all to the extension of the agreement between Russia and Saudi Arabia in order to further control the oil market. This would pave the way for a reduction in the output of major oil producing countries in the world, which would reduce supply.
At the end of the week OPEC member countries will meet with other major producer countries to discuss the reaction to the drop in oil prices in recent weeks. Russian President Vladimir Putin said there was still no decision on quantities. However, there are some oil producing countries that consider that Saudi Arabia’s highest production has created the problem only since last June, so it is up to the Kingdom to shoulder the burden. However, the leadership in Riyadh wants to redistribute the cuts, and obviously this will change the equation in its favor.