Qexit: The Beginning of an Era or the End of One

Updated: Apr 4, 2020

Written by - Divy Tandon

On Monday, December 3, 2018, the Energy Minister of Qatar, Saad Sherida Al-Kaabi, announced that the State of Qatar shall be leaving the Organisation of Petroleum Exporting Countries and thus end a 60 year-old association with the Organisation, in effect from the January of 2019. The Gulf state is the first Middle East nation to quit the oil cartel, saying it wants to concentrate on gas production and that the move is not political. While the reason for the withdrawal is unknown, it is believed by many that Qatar is leaving OPEC due to the dominance of its hostile neighbour, Saudi Arabia, within the organisation.

While many believed that the withdrawal of Qatar will affect the organisation drastically, that is not the case. According to statistics, Qatar produces almost 600,000 barrels of oil per day, which is less than 2% of OPEC’s total production, while Saudi Arabia on the other side pumps roughly 10 million barrels per day. The exit did little to upset the energy market currently, though it is speculated that this move could see Qatar calling the shots on natural oil prices in the long term, especially in Asia.

This departure, however, is also an indication of ongoing tensions in the Middle East. While the Organisation has fought against all thrown at it, and even act as a neutral ground for feuding parties, it seems that current political friction has weathered the Organisation.

The departure also indicates how Qatar sees a low political value in the group. Sheikh Hamad Bin Jassim Al Thani, Qatar’s former prime minister, said “ the Organisation has become useless and adds nothing to us.” Going further, he said the organisation was being used “only for purposes that are detrimental to our national interest.”

This withdrawal has indicated to the OPEC that it cannot control the global oil policy alone and hence the Organisation has gone all out lobbying a wide group of non-members with Russia playing an instrumental role in it.

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