DOHA, Qatar – On Monday, Qatari Energy Minister Saad bin Sherida al-Kaabi announced the sudden departure of Doha from the Organization of the Petroleum Exporting Countries (OPEC). This move will have serious consequences on the future of OPEC.
“Qatar has decided to withdraw from OPEC as of January 1, 2019,” al-Kaabi told a news conference, adding that the country wants to focus on gas extraction and LNG production. After the statements, oil prices fell sharply.
Qatar has stated that it will continue to comply with all international agreements, and the decision to withdraw is purely economic in nature and is not caused by disagreements with other members of the organization.
“This is a technical decision, caused by the desire to strengthen Qatar’s position as a reliable supplier of energy in the world, as well as based on the volume of oil production in Qatar,” said the minister, thanking the organization for his efforts.
Previously, the Arab country had issued plans to launch four new LNG production lines by 2024, and is already considered the largest exporter of this type of raw material. It is planned to increase LNG production from 77 million to 110 million tons per year.
The Organization of the Petroleum Exporting Countries (OPEC) is an international intergovernmental association set up by oil producing countries to control production quotas.
OPEC members control about two-thirds of the world’s oil reserves, accounting for up to 45% of all world production and half of exports. The organization includes Algeria, Angola, Venezuela, Gabon, Iran, Iraq, Congo, Kuwait, Qatar, Libya, United Arab Emirates, Nigeria, Saudi Arabia, Equatorial Guinea and Ecuador.
For 57 years, Doha was a member of the organization, with its daily oil production of 620,000 barrels of oil. The share of Qatar oil in total cartel production last year was 1.85%.
Back in September OPEC reported that member countries provided less oil to world markets in the July-August comparison, which led to a price increase of $80 a barrel.