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3 Dec, 2018 15:08

Qatar quitting OPEC 'bad for oil cartel's and Saudi credibility'

Qatar quitting OPEC 'bad for oil cartel's and Saudi credibility'

Qatar leaving the Organization of the Petroleum Exporting Countries (OPEC) is largely a symbolic step, expert tells RT, as the Gulf state is a marginal player in the oil trade. But they say repercussions will be felt in Riyadh.

While the move is merely symbolic for Qatar, a founding member quitting OPEC after 57 years cannot look positive for the organization, John Hall, chairman of Alfa Energy, a UK-based consulting company said in an interview with RT.

“They are making their point,” the expert said, stressing Doha was driven by Saudi Arabia and the Saudi-led blockade. “It will hit [the] credibility of the OPEC, as well as it will hit Saudi Arabia as the de-facto leader of the OPEC.”

The analyst stressed that the tiny gas-rich state of Qatar accounts for a minuscule share of the total oil output by the OPEC countries. The country reportedly produces 600,000 barrels of oil a day compared to more than 27 million from all the members of the cartel.

According to Hall, the move is mainly a political decision and Qatar may even come back to OPEC some day. However, the current state of affairs won’t make the country’s position worse, as Qatar is “isolated anyway.”

Qatar is not the first OPEC member to quit the cartel that was founded in 1960 in Baghdad. Indonesia rejoined the organization in 2016 after an absence of nearly eight years. Gabon quit the cartel in 1996 and renewed its membership after 20 years.

For more stories on economy & finance visit RT's business section