Russia's newspaper Kommersant reported Monday that some of the world's largest natural gas exporters have reached a final agreement on the creation of a cartel-like group for gas.
The consortium of gas-rich countries, which includes Russia, Iran, Qatar, Venezuela and Algeria, is due to be formally organized in the Qatari capital of Doha on April 9, the newspaper said. The countries are scheduled to meet at the Gas-Exporting Countries Forum, an organization that was found in 2001 to unite the countries that together control more than 70% of the world's reserves.
If this should occur, it would be a major blow for the Bush administration, which is on record opposing the formation of a gas exporting group that would mirror the Organization of Petroleum Exporting Countries.
Although he didn't use the words "gas cartel" specifically, Energy Secretary Samual Bodman during a speech in Houston last month said that "initiatives, new or old which seek to control the flow of energy supplies to the market and circumvent the role of the market to set prices, are contrary to the long-term interests of both producers and consumers."
Bodman didn't single out any overseas gas-producing countries, but his remarks coincided with Russian President Vladimir Putin's visit to the Middle East, where he was talking up an international natural gas cartel (see Daily GPI, Feb. 15).
The formation of an international natural gas cartel could have a disastrous impact on the United States as it seeks to import greater amounts of foreign gas supplies to meet growing domestic demand.
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