The World of International Organizations Explained

Qatar quits OPEC to boost gas production

Doha, Qatar's futuristic skyline by night (ARÊTE/Jimmy Baikovicius)

OPEC is poised to lose the world’s largest exporter of liquified natural gas starting in 2019.

Qatar’s energy minister, Saad Sherida Al-Kaabi, announced his nation will pull out of the Organization of the Petroleum Exporting Countries, which it joined in 1961, and expand its liquefied natural gas production.

“In light of such efforts and plans, and in our pursuit to strengthen Qatar’s position as a reliable and trustworthy energy supplier across the globe, we had to take steps to review Qatar’s role and contributions on the international energy scene,” al-Kaabi said.

The decision could mark the first time a nation has permanently withdrawn from OPEC since its founding in 1960 at Baghdad, Iraq. Or Qatar could follow the trajectories of Ecuador, Gabon and Indonesia, which have previously withdrawn or suspended their memberships only to eventually rejoin.

But the decision, al-Kaabi said, was not linked to the Saudi Arabian-led political and economic blockade against Qatar since last year. The blockade by Saudi Arabia, OPEC’s biggest member, also includes Bahrain, Egypt and United Arab Emirates.

In his surprise announcement, al-Kaabi made no mention of U.S. President Donald Trump’s criticism aimed at persuading Saudi Arabia and other OPEC members to lower rising oil prices.

The tiny monarchy of Qatar, located on a Persian Gulf peninsula, is home to Al Udeid Air Base, the biggest U.S. military facility in the Middle East, and about 10,000 U.S. troops. Qatar plans to expand Udeid and another air base.

Formed in reaction to Western nations’ domination of the energy industry, OPEC became the third international organization to be based in Vienna, Austria, after the International Atomic Energy Agency and U.N. Industrial Development Organization.

A strong signal from Qatar

OPEC had no immediate reaction. Qatar gained enormous wealth in the past half-century and aggressively bid to become a global hub of diplomacy, politics and sports, including successfully landing the 2022 FIFA World Cup.

Those moves, along with its support of the Islamist Muslim Brotherhood and close economic relations with Iran, have sometimes put it at odds with some of its Middle East neighbors.

As a small crude oil producer, Qatar’s decision has little impact on the oil market. But backed by it huge liquids production, Qatar has sent a strong signal about its views on OPEC’s importance.

Without Qatar, OPEC will be left with 14 members: Algeria, Angola, Congo, Ecuador, Equatorial Guinea, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Saudi Arabia, United Arab Emirates and Venezuela.

Bahrain, Egypt, Saudi Arabia and the United Arab Emirates cut ties to Qatar in June 2017 over its alleged support for extremist groups, which Qatar has denied.

Those countries began an economic boycott by closing off Qatar’s border with Saudi Arabia, and by blocking its ships from using their ports and preventing Qatar Airways flights from entering their airspace.

The world of international organizations explained.

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