Doha (AFP) – Qatar will leave OPEC next month in order to focus on gas production, the Gulf state’s new Energy Minister Saad al-Kaabi announced Monday, denying the surprise move was a result of Doha’s bitter feud with oil-rich Saudi Arabia.

Qatar has been a member of OPEC since 1961 and the decision to pull out after more than five decades comes at a turbulent time in Gulf politics, with Doha under a boycott by former neighbouring allies including Saudi Arabia for 18 months.

Saad Sherida Al-Kaabi, Qatari energy minister, announces during a press conference in Doha that his country will leave OPEC in January to focus on gas production (AFP Photo/Anne LEVASSEUR)

“Qatar has decided to withdraw its membership from OPEC effective January 2019 and this decision was communicated to OPEC this morning,” Kaabi told a Doha press conference.

Kaabi, who also heads state-owned Qatar Petroleum, denied however that the move was linked to the feud with Saudi Arabia and its allies.

The decision was “technical and strategic” and had “nothing to do with the blockade”, he said.

Qatar’s still-influential former prime minister Hamad bin Jassim bin Jaber Al-Thani subsequently tweeted that OPEC was of “little use” and being “used only for aims that undermine our national interest”.

Qatar will continue to produce oil and seek deals in countries including Latin America’s top oil producer Brazil, said Kaabi.

In a first reaction to the Qatari announcement, UAE state minister for foreign affairs Anwar Gargash tweeted that the OPEC exit was an admission of “the decline of Qatar’s role and influence in light of Doha’s political isolation”.

Some analysts saw Qatar’s withdrawal as a “political decision to oppose Saudi Arabia”, which alongside the United States and Russia is the biggest producer in OPEC.

“So is it really worth it to someone like Qatar to go to Vienna to meet with someone who will lead the meeting and who is your enemy?” asked Thierry Bros, a researcher with the Oxford Institute for Energy Studies.

“In the end, perhaps you can do without it.”

– ‘Our potential is gas’ –

Kaabi said gas production would remain the top priority for Qatar, which is the world’s the biggest exporter of liquefied natural gas (LNG).

Qatar’s oil and gas. Graphic showing Qatar’s oil and gas infrastructure and reserves (AFP Photo/Gal ROMA)

“We don’t have great potential (in oil), we are very realistic,” said Kaabi, who described himself as “Mr Gas” during the conference. “Our potential is gas.”

“I think it’s inefficient to focus on something that’s not your core business and something that’s not going to benefit you long-term.”

In September, Qatar announced it plans to boost gas production to 110 million tonnes per year by 2024.

Qatar’s oil production is around 600,000 barrels per day, making it the world’s 17th largest producer of crude, according to the specialist website, world data.info.

It also only holds around two percent of the world’s global oil reserves, according to the CIA World Factbook.

Kaabi said that would still attend OPEC’s Vienna meeting later this week, his “first and last” as energy minister.

That meeting is expected to set a policy for 2019 and despite Qatar’s announcement, oil prices soared on Monday after Russia and Saudi Arabia renewed a pact to cap output on the sidelines of a G20 summit.

While there was no announcement on how much would be cut and for how long, the pact was cheered by oil traders, with Brent jumping $2.60 to $62.06 and West Texas Intermediate up $2.42 to $53.35.

– ‘Symbolic move’ –

Although Qatar’s sudden move came out of the blue, analysts say it will have limited impact on the global market.

Fiona Cincotta, a senior market analyst at UK-based City Index, said Qatar had “surprised the market” but added it was another sign that “some major production decisions will be taken outside of OPEC” following the G20 summit that closed Saturday in Buenos Aires.

Amrita Sen, chief oil analyst for Energy Aspects consultants, argued the move would have limited impact.

“Quitting OPEC is largely symbolic for Qatar,” he told Bloomberg.

“Its oil production has been steady with limited prospects for increases.”

OPEC is dominated by oil-rich Saudi, which along with the UAE and other allies has had no ties with Qatar since June 2017.

Relations between Riyadh and Doha are at an all-time low as a result of the crisis, which has seen Saudi-led countries accuse Qatar of supporting terrorism and being too close to Iran.

Qatar refutes the allegations and claims rivals want to overthrow its government.

But researcher Bros argued that Qatar’s departure would weaken OPEC at a moment when Riyadh is battling an international outcry over the murder of journalist critic Jamal Khashoggi.

“This shows that it will become more complicated to run things (at OPEC). Those that remain are not great friends, such as Iran and Saudi Arabia,” said Bros.

Kaabi meanwhile announced that Qatar would “make a big splash in the oil and gas business soon,” adding Doha would also build the Middle East’s biggest ethane cracker, an industrial facility which converts gas to by-products such as adhesives and ethylene for plastics.

Featured Photo: “A file photo taken on February 6, 2017 shows the Ras Laffan Industrial City, Qatar’s principal site for production of liquefied natural gas and gas-to-liquid, administered by Qatar Petroleum (AFP Photo/KARIM JAAFAR)”

In an annual address to the nation, Emir Sheikh Tamim bin Hamad al-Thani pointedly called on other Gulf states to respect Qatar’s sovereignty and not “interfere” in other countries’ affairs.

“History teaches us that crises pass, but their mismanagement may leave behind long-lasting effects,” Sheikh Tamim bin Hamad Al-Thani said.

Once allies, Saudi Arabia, the United Arab Emirates and Bahrain have imposed a near-total embargo on Qatar since June 2017 over allegations the emirate supports radical Islamist groups and seeks closer ties with Riyadh’s arch-rival Tehran.

Qatar denies the charges, accusing its neighbours of seeking regime change.

The emir said the crisis had exposed the weaknesses of the Gulf Cooperation Council (GCC), the regional political bloc of which the rival countries are members.

“It’s truly regrettable that the continuation of the Gulf crisis revealed the failure of the GCC to achieve its objectives and meet the aspirations of our Gulf people.”

He said Qatar had suffered no economic damage from the boycott and predicted it would retain its position as the world’s largest exporter of liquefied natural gas.

“Our oil and gas exports have not been affected by the blockade,” he said.

“The state has been keen on fulfilling all its obligations under the existing contracts and has signed several long-term contracts, the latest of which was with Petro China.”

The crisis has thrown into the spotlight Qatar’s preparations for the 2022 World Cup, which have been plagued with allegations of labour rights violations.

Sheikh Tamim said maintaining the huge expenditures necessary to host international football’s showpiece tournament was “not easy” but the government had done so despite the hit state revenues had taken from the sharp fall in world energy prices from 2014.

Qatar has previously said it is spending around $500 million a week to prepare for 2022.

Sheikh Tamim, who has been in power since 2013, also had a warning for the population, saying that the country’s astonishing wealth must be matched by ethics and morality.

“The high standard of living of the citizen must be accompanied by a development of values,” he said.

If this does not happen, a “state of social corruption” could emerge.

Featured Photo: AFP/File / STR. Qatar’s ruler has warned of “long-lasting” scars from a diplomatic dispute that has seen the energy-rich emirate isolated by Saudi Arabia and its allies for more than a year.

The backlash may force Riyadh to ease sweeping sanctions imposed on Doha since the dispute erupted between the former Gulf allies in June 2017.

The killing of Khashoggi — who was critical of the Saudi government and its blockade of Qatar — may convince sceptics that Doha’s claims of Saudi “aggression” were justified, according to analysts.

“I wouldn’t be surprised if the Qataris could indirectly benefit from what’s happening right now,” said Dr. Andreas Krieg, of King’s College London and former adviser to Qatar’s military.

“The Saudis have to make concessions.”

For the past 16 months, regional heavyweight Saudi Arabia — the only country that shares a land border with Qatar — has led Arab allies in isolating the small, gas-rich emirate.

Saudi Arabia, the United Arab Emirates, Bahrain and Egypt froze all diplomatic ties with Doha, accusing it of cosying up to Riyadh’s regional rival Tehran and supporting radical Islamist groups, including the Muslim Brotherhood.

Economic activity between the former allies has practically seized, while Qatari planes have been banned from using Saudi airspace and that of other countries.

Saudi Arabia, the UAE and Bahrain also banned their citizens from travelling to Qatar as part of the boycott.

Doha, which denies the allegations of supporting militant groups and being too close to Iran, accuses its former allies of seeking regime change.

– ‘US can exert leverage’ –

Qatar claims the boycotting nations have split families in the region and says its citizens have been prevented from undertaking the Muslim hajj pilgrimage in Saudi Arabia.

“I think if the US government wants to end the Qatar crisis it can exert leverage over the Saudis as a bargaining chip in relation to Khashoggi’s death,” Kristian Ulrichsen, a fellow at Rice University’s Baker Institute, told AFP.

AFP / Yasin AKGUL. An official stands at the door of Saudi Arabia’s consulate in Istanbul, on October 23, 2018, during ongoing investigations into the killing of Saudi journalist Jamal Khashoggi.

Others remain sceptical.

“It is too early to tell,” said Noha Aboueldahab, a visiting fellow at the Brookings Doha Center.

“The Khashoggi case has damaged Saudi Arabia’s reputation, particularly its so-called ‘counter-terrorism’ narrative”, she said.

But “at this point, the Qatar/Saudi stand-off remains quite low on the priorities list”.

Key Gulf allies of Saudi Arabia backed the kingdom after Khashoggi disappeared on October 2, while Qatar initially maintained a silence that Aboueldahab called “prudent”.

Doha only made its first comments three weeks into the affair, calling it “a wake-up call”.

Qatar’s public line came shortly after Saudi Arabia admitted the journalist died inside the consulate after a “brawl and a fistfight”, an account that Britain, France and Germany say must be backed by “credible” facts.

Doha was anxious not to be drawn into the crisis, especially as some had speculated that Qatar had a hand in events.

Before Riyadh admitted Khashoggi died at the hands of Saudis, social media was aflame with claims Qatar planned the incident, especially as it occurred in Turkey, Doha’s staunch ally.

There has also been anger among Saudis over Qatar-based broadcaster Al Jazeera’s extensive coverage of the murder, with some claiming it is seeking to inflict maximum embarrassment on the kingdom.

Well before the Khashoggi affair, Riyadh demanded Al Jazeera be closed, as one of its key conditions for terminating the blockade on Qatar.

“I think the world is now seeing what people in the Middle East have seen”, said Ulrichsen. “This is a very different Saudi Arabia they are living with” since Crown Prince Mohammed bin Salman rose to ascendancy.

The young and ambitious Prince Mohammed was named successor to the throne by his father King Salman in June 2017 and has since sidelined all his rivals.

– Rumoured talks –

But with Riyadh on the back foot over Khashoggi’s murder, there are whispers of a rapprochement with Qatar.

There are rumours that Qatar’s Emir Sheikh Tamim bin Hamad al-Thani has recently held talks with Saudi Foreign Minister Adel al-Jubeir.

“I wouldn’t be surprised that if behind closed doors people are talking,” said Krieg.

If so, it would represent a major development since the last known formal Saudi contact with the Qatari leader was in a phone call with Prince Mohammed in September 2017.

And on Wednesday, Prince Mohammed acknowledged at the Future Investment Initiative in Saudi Arabia that Qatar “has a strong economy”, despite “our differences”.

Krieg speculated concessions could ultimately mean a deal on airspace, hajj or family reunifications.

“That’s solving the crisis for people,” he said.

But possible concessions would not herald an end to the Qatar crisis or a return to pre-June 2017 diplomatic relations, analysts said.

Any deal would also have to involve the UAE, but the enmity between it and Qatar seems particularly entrenched.

Featured Photo: Saudi Royal Palace/AFP/File / BANDAR AL-JALOUD. Saudi King Salman (L) meets the Emir of Qatar Sheikh Tamim bin Hamad al-Thani in Doha in 2016, six months before diplomatic ties between the two nations ruptured.

Mohammed bin Abdulrahman Al-Thani also rebuked Qatar’s foes for “imaginary victories” against the small Gulf state, the target of a Saudi-led boycott.

“One year on and Qatar and its people are stronger,” Al-Thani, one of the most prominent voices in the region’s worst diplomatic crisis for years, wrote on Twitter.

“(There’s) a lot of talk about imaginary victories and isolating Qatar, but after one year, the reality proved the opposite as Qatar emerged as an international partner that can be trusted.”

On June 5, 2017, a Saudi-led alliance including the United Arab Emirates, Bahrain and Egypt abruptly severed ties with Qatar, accusing it of supporting terrorism and Iran.

Skyline of Doha, Qatar from the Islamic Art Museum. By Juan Cole..

Qatar soon found its only land border closed by Saudi Arabia, its state-owned airline barred from using neighbours’ airspace, and residents expelled from the quartet’s countries.

Despite hopes that the rancorous rift between the former allies — which include some of the richest countries on earth — would be resolved quickly, the crisis has endured.

Qatar claims the dispute is an attack on its sovereignty and punishment for pursuing an independent foreign policy.

Diplomatic efforts led by Kuwait and the United States have so far stalled though there are tentative plans for talks in September.

Al-Thani said the “door is still open for dialogue” between the Gulf rivals.

However, he also told Qatar state-funded broadcaster Al Jazeera on Tuesday that Doha would continue with its purchase of the Russian S-400 air defence missile system.

Saudi leaders have asked French President Emmanuel Macron to intervene to prevent the deal going ahead, raising fears of military action in the dispute.

Raising the military stakes yet further, Qatar’s defence minister Khalid bin Mohamed Al-Attiyah, said Tuesday that Doha wanted to join NATO.

“The ambition is full membership if our partnership with NATO develops and our vision is clear,” he told the official magazine of the Qatari defence ministry, Altalaya.

– ‘Smear campaign’ –

Despite the impact of the crisis, many in Qatar view the past year’s events as a victory for Doha.

Qatari papers were jubilant on Tuesday, with headlines such as “Triumphant Qatar stays united” and “Qatar shines as smear campaign against it fails”.

Taxi companies offered customers free rides and some in Qatar have even called for June 5 to be made a national holiday.

Meanwhile, Qatar’s National Human Rights Committee (NHRC) released a report claiming more than 4,000 human rights abuses had been committed against Qataris by the Saudi-led alliance in the past year.

Qataris have been exposed to arbitrary arrest and routinely denied freedom of movement, according to the report by the government-appointed body detailing alleged abuses including one case of forced disappearance.

“From the beginning, all the blockading countries have tried to use the people to achieve their political goals,” NHRC chairman Ali bin Smaikh al-Marri said.

There was no immediate reaction from the Saudi-led bloc.

In August, Saudi Arabia will welcome millions of Muslim faithful for the hajj pilgrimage to Mecca, the holiest city in Islam.

The Saudi government on Tuesday confirmed Qataris wishing to undertake the umrah pilgrimage to Mecca were welcome, but accused the Qatari authorities of a “negative attitude”.

Since the start of the crisis, Qatar has accused Saudi Arabia of politicising religious pilgrimages to Mecca, including the hajj, one of Islam’s five pillars, which every able-bodied Muslim who can afford the journey is obliged to undertake at least once.

Featured Photo: AFP/File / KARIM JAAFAR. Qataris write comments on a wall bearing a portrait of Emir Sheikh Tamim bin Hamad Al Thani on July 06, 2017.