The tiny Arab nation of Qatar announced Monday it will withdraw from the Organization of the Petroleum Exporting Countries, or OPEC, in January, mixing its aspirations to increase production outside of the cartel's constraints with the politics of slighting the Saudi-dominated group amid the kingdom's boycott of Doha. The surprise announcement from Qatar's minister of state for energy affairs, Saad Sherida al-Kaabi, again throws into question the role of the cartel after needing non-members to push through a production cut in 2016 after prices crashed below $30 a barrel. It would also mark the first time a Mideast nation has left the cartel since its founding in 1960, per the AP. In a statement, al-Kaabi said Qatar, the world's largest exporter of liquefied natural gas, wants to raise its oil production and plans to increase its exports from 77 million tons of gas per year to 110 million tons.
OPEC was formed in 1960 as a reaction to Western domination of the oil industry. Qatar was the first nation outside of its founding members to join, entering its ranks in 1961. Qatar produces only some 600,000 barrels of crude oil a day, making it OPEC's 11th biggest producer. The loss of production, under 2% of OPEC's overall supply a day, won't greatly affect the cartel's position in the market. An oil analyst says Qatar's decision "has no impact on the market either way," adding "the cost for them is higher than the benefit" of remaining in OPEC: "This is just like shutting down a losing business." With Qatar, OPEC has 15 members, including Algeria, Angola, Congo, Ecuador, Equatorial Guinea, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Saudi Arabia, the United Arab Emirates, and Venezuela. Among its members, Saudi Arabia is by far its largest oil exporter. There was no immediate comment from OPEC, which is to meet this month to discuss possible production cuts. (Read more Qatar stories.)