Sudden! Qatar Announces Withdrawal from OPEC, World Oil Order Changes!
According to previous news, OPEC and its allies will meet in Vienna on December 6 to decide on efforts to stabilize the oil market and reverse the plunge in oil prices. Saudi Arabia was the first to announce a cut in production of 500000 barrels a day to boost oil prices, and proposed that OPEC and its allies cut production by 1 million barrels from January 2019. Russian President Vladimir Putin and Saudi Crown Prince bin Salman announced after meeting during the G20 meeting that they agreed to extend the OPEC crude oil production reduction agreement to 2019.
Qatari Energy Minister Alqabi said the withdrawal was a "technical and strategic" change and not politically motivated.
But from a geopolitical point of view, the small Middle East country Qatar and OPEC's actual "boss" Saudi Arabia have deep grievances, and relations are deteriorating. On June 5 last year, Saudi Arabia and other four countries announced the severance of diplomatic relations with Qatar and imposed an embargo on the country. Although Qatar has repeatedly expressed its willingness to ease relations, Saudi Arabia's attitude is quite tough, and relations between the two countries are still deadlocked.
In OPEC, Qatar is also very inexistent. Although Qatar has joined OPEC for 57 years, in this organization based on crude oil output, Qatar's monthly output of hundreds of thousands of barrels is only insignificant compared with the monthly output of more than 10 million barrels, so the right to speak is also very small.
But as the world's largest LNG producer and exporter, Qatar is an unbeatable presence in the natural gas sector. The announcement of withdrawal from OPEC is also to focus on natural gas production, and will no longer be committed to fulfilling the OPEC agreement. OPEC, the 58-year-old international crude oil organization, is also facing the dilemma of disintegration.
Before Qatar announced its withdrawal from OPEC, people familiar with the matter said that Saudi Arabia may consider dissolving OPEC in the future, partly under pressure from the United States and outside investors. The King Abdullah Petroleum Research Center (Kapsarc), the country's top think tank funded by the Saudi government, is studying the impact of the split of OPEC on the oil market, but this does not mean that the Saudi government is also actively discussing "leaving OPEC in the near future". Within OPEC, it is also beginning to become less harmonious. Some member states are unhappy that Saudi Arabia is too close to Russia and feel that they have been marginalized in policy discussions. Saudi Arabia and Iran have always been geopolitical competitors. With the entry into force of US sanctions on Iran's oil exports, the relationship between the largest oil producer and the third largest country in the organization is tense, which has also begun to affect OPEC's oil policy considerations.
But in any case, OPEC is being marginalized, and key decisions in the oil market have fallen into the hands of the oil giants of the United States, Russia and Saudi Arabia. (article from the Changxing Island petrochemical market official website)