Qatar’s decision to withdraw from OPEC in January 2019 part of increasing effort to break from Saudi influence – Qatar Analysis

Executive Summary

The Qatari announcement of a planned withdrawal from the Organization of the Petroleum Exporting Countries (OPEC) largely stems from Qatar’s inability to influence decisions made by the organization due to Doha’s relatively low oil output.
This development highlights the continued efforts by Qatar to implement Qatari-centric policies, which effectively are causing the state to distance itself from the the Gulf Cooperation Council (GCC), mainly due to Doha’s interest in breaking away from Saudi influence, as the latter retains wide influence over OPEC and the GCC.
Although Qatar’s withdrawal will likely not have significant effect on OPEC, the limited backlash the country is facing after announcing its plan to withdraw may prompt Oman, who shares similar interests, to follow suit in the future.
Travel to Qatar may continue as normal while adhering to cultural norms and avoiding making any statements critical of the Qatari Emir and government officials.

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Current Situation

The Minister of State for Energy Affairs Saad bin Sherida al-Kaabi, who is also the president and chief executive of Qatar Petroleum (QP), stated on December 3 that Qatar will withdraw its membership of The Organisation of the Petroleum Exporting Countries (OPEC) starting on January 2019.
Al-Kaabi stated that the decision comes after Qatar reviewed ways to enhance its international role and plan long-term strategy. As the world’s largest exporter of liquefied natural gas (LNG), Qatar intends to focus its efforts on developing its natural gas industry and increasing its LNG production to 110 million tonnes by 2024. The minister emphasized that for him to “put efforts, resources and time in an organization that we are a very small player in […] practically it does not work, so for us it’s better to focus on our big growth potential.”
He added that the Gulf state would nevertheless continue to produce oil, as the state-run oil firm QP planned to increase its production capability to 6.5 million barrels of oil equivalent a day from 4.8 million over the next decade. In addition, Qatar remains interested in expanding its international oil investments from abroad and would “make a big splash in the oil and gas business.”
Meanwhile, on December 9, the emir of Qatar Sheikh Tamim bin Hamad al-Thani did not attend the GCC summit in Riyadh, and sent a lower-ranking delegation instead.

Assessments & Forecast

This decision highlights the independent policies the Qatari leadership is striving to implement. Thus, as production targets within OPEC are usually set by leading oil exporters, such as Saudi Arabia, Qatar likely withdrew its membership given its much smaller outputs in crude oil, which prevented it from circumventing the directions laid out by the organization. This is partly due to Qatar’s current efforts to raise its oil production, which contradicts the expectations of cuts from OPEC members, due to low oil prices. That said, this potential increase in oil production will remain limited, due to Qatar’s efforts to further focus on the LNG sector, of which Qatar is the leading exporter. FORECAST: However, Qatar’s withdrawal from OPEC is unlikely to significantly impact the organization, given that Qatar’s contribution to it remained marginal, as the state has a share of approximately 2% of OPEC’s output.

In addition to the availability of natural resources and the economic aspect, the intended withdrawal of Qatar from OPEC stems largely from a desire of the state to further disassociate from some other GCC members, namely the UAE and Saudi Arabia. In this context, recent developments point to Doha’s increasing efforts to seek independence from neighboring states, including Sheikh Tamim’s sending a delegation composed of lower-ranking officials to the December 9 GCC summit, as opposed to attending himself. It is likely that the withdrawal from OPEC was in preparation for several months or years by the Qatari government. Qatar may have refrained from implementing it so far due to the ongoing blockade from Saudi-aligned states, following their severance of ties with Doha in June 2017, in order to avoid escalating the crisis.

However, since this status quo has largely prevailed in recent months, the Qatari government likely chose to announce the planned withdrawal now, with the expectations that at this point in time it will not yield a significant response from the blockading states. This may have been bolstered by the current weakened position of Saudi Arabia’s Crown Prince Mohammed bin Salman (MbS), due to the allegations of his involvement in ordering the killing of journalist Jamal Khashoggi at the Saudi Consulate in Istanbul on October 2. Given that MbS remains fragile amidst this international backlash, the Qatari leadership may have announced their withdrawal from OPEC knowing that the Crown Prince would not take measures to oppose the move, as he is currently trying to rehabilitate his international image by projecting moderation.

In addition, Qatar’s withdrawal from OPEC is more specifically meant to move away from Saudi Arabia’s influence, with which regional rivalries have increased in recent years. Thus, following the announcement of withdrawal from OPEC, a Qatari official reportedly stated that Qatar does not want to depend on Saudi Arabia, as the latter controls OPEC due to their vast oil reserves.
FORECAST: Going forward, Qatar will continue striving to break away from Saudi influence and that of the rest of the GCC over the coming months, by pursuing more Qatari-centric policies, both in terms of economic and of foreign policy. For the former, as announced, this will manifest in slightly increasing Qatar’s oil output and focusing on the highly-beneficial production of LNG, while the latter may include measures aimed at strengthening relations with Iran. This will likely be further prompted by the overall hawkish policies enacted by Saudi Arabia under the direction of MbS, which is fostering disunity among the GCC states.


Travel to Qatar may continue as normal while adhering to cultural norms and avoiding making any statements critical of the Qatari Emir and government officials.
In light of the ongoing dispute between Qatar and regional states, it is advised to anticipate potential disruptions to services and to remain cognizant of developments and their potential effects on travel and business continuity.

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