Approximately 14 major natural gas-producing countries are expected to meet in Moscow in June to discuss forming an OPEC-like cartel to control the price and supply of natural gas on the world market, the Qatari Energy Minister said in a published report.
“I would like, as a producer, to see gas at full parity to oil because gas is even more expensive to produce than oil, and gas is a cleaner fuel,” Abdullah al-Attiyah told The Times of London Friday.
The Organization of Petroleum Exporting Countries (OPEC), which is composed of 13 oil-producing countries, works to keep oil prices high by reducing members’ production allotments when prices decrease, thus causing prices to rise again as supply tightens. The United States is opposed to the creation of an OPEC-like group for natural gas.
The formation of an OPEC-like group for gas has been a hot topic over the last few years. The U.S. House last July passed a nonbinding resolution opposing efforts by major gas-exporting countries to form a cartel or other mechanism to influence the supply of gas and its price to the world market (see NGI, July 16, 2007).
The House action came just months after a group of major gas producers met in Doha, Qatar, to lay the groundwork for a potential world gas cartel (see NGI, April 16, 2007). At the April 2007 meeting, the 14 members of the Gas Exporting Countries Forum set up a commission to assess the feasibility of establishing an exporters’ group for natural gas.
The commission, which is made up of the deputy energy ministers from major gas-producing nations, is expected to report its findings at the Moscow meeting in June. The forum was founded in 2001 to unite the countries that together control more than 70% of the world’s natural gas reserves. Some of the major gas-producing countries that are members of the forum include Russia, Iran, Venezuela, Qatar, Algeria, Malaysia, Norway, Nigeria, Oman, Turkmenistan, Brunei and Indonesia.
Energy experts doubt that a cartel-like organization for gas, even if formed, would have the same clout as OPEC. Daniel Yergin of Cambridge Energy Research Associates told a House committee in 2007 that establishment of a gas cartel-like organization was inevitable, but he did not believe producing countries could control the international gas market in the same way OPEC has influenced global oil prices and supplies.
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