The Strategist

Qatar leaves OPEC

12/03/2018 - 14:18

The decision to leave OPEC was made after Qatar considered ways of enhancing its role at the international level and planned its long-term strategy, Qatari Energy Minister Saad Al Kaabi said at a press conference in the Qatari capital Doha.

"Qatar has decided to suspend its membership in OPEC since January 2019, and OPEC was notified of this decision this morning," the minister said.

According to Al Kaabi, the country will not remain committed to OPEC agreements after leaving the cartel.

The minister noted that the decision was not easy, given that Qatar has been a member of OPEC for 57 years, but the country's influence on OPEC production decisions was small.

According to information of secondary sources given in the OPEC report, oil production in Qatar in November was 609 thousand barrels per day, having increased by 14 thousand bpd compared with the previous month. Qatar accounts for less than 2% of OPEC’s total oil production, which totaled 32.9 million bpd last month.

At the same time, Qatar is the world's largest exporter of liquefied natural gas (LNG). The country intends to focus on the production of gas, writes Bloomberg.

Earlier, it was reported that Qatar wants to increase LNG production by 43% by 2025 compared with the current level. By 2025, the state-owned company Qatar Petroleum will increase LNG production from the current 77 million tons to 110 million tons per year by commissioning four production lines.

OPEC and its allies, including Russia, are preparing to meet in Vienna on December 6-7 to revise their production strategy. Earlier, Saudi Arabia and Russia agreed to extend the agreement on reducing oil production in order to balance the oil market. Qatar intends to attend the OPEC + meeting this week, Al Kaabi reported.

Refusal of obligations under the OPEC + agreement means that Qatar can increase production after leaving the group.

According to the minister, the decision is not related to the political and economic boycott of Qatar, introduced in June 2017 by the de facto OPEC leader Saudi Arabia and three other Arab states.