Today.Az » World news » Qatar can get benefit of OPEC without membership
07 December 2018 [15:03] - Today.Az
Qatar can get benefit of OPEC without continuing to be its member, Spencer Welch, director of the oil markets and downstream team in the London-based IHS Markit told Trend.
Qatar’s move is interesting but not hugely significant, said the expert, adding that Qatar’s oil production is a small part of OPEC.
"They see little value in continuing to be a part of the organization. Maybe, relations with Saudi Arabia are strained, and they probably don’t want to be told when they have to cut oil production. By dropping out they can potentially get the benefit of OPEC without having to cut production," he added.
He pointed out that ultimately Qatar’s focus is gas production, much more than oil.
At the same time, he the expert noted that OPEC is stronger now than for a while with the alliance with Russia and other non-OPEC countries, plus other African countries keen to join OPEC.
Qatar’s Energy Minister, Saad al-Kaabi, has announced that the country will leave OPEC with effect from 1st January 2019. Mr. al-Kaabi pinned the decision on the country’s desire to focus on investing in its LNG capacity and that, as a small oil producer, it had little influence over OPEC policy.
Saad al-Kaabi said Qatar has decided to withdraw its membership form OPEC effective January 2019 and this decision was communicated to OPEC.
The announcement comes ahead of the meeting by OPEC and its allies including Russia on Dec. 6-7 to discuss cutting supply.
The minister said the decision was not easy as Qatar has been in OPEC for 57 years, but that the country’s impact on OPEC production decisions was small.