The news agencies announced yesterday that Qatar is leaving OPEC. The buzz seems to indicate that the reasons are political – tensions with neighbors. I do not feel this is the reason. I am certain in my own mind that the reasons are economic.
Qatar states that the nation wants to pursue its ventures in gas production, not petroleum. This makes sense to me. The reason is that the US is setting the petroleum world on fire with its fracking technology. Can anyone compete with the US for producing light sweet crude?
The future of petroleum is going to be founded on technology, automation, and global warming. In other words, this is the beginning of the breakup of OPEC. Efficiency is the key – in production and consumption. It appears that the US is going to be the world leader in oil production and export.
As the next few years pass, look for OPEC to start crumbling. OPEC should splinter until it becomes irrelevant and dissolves. The US will lead the world in petroleum due to its technology: fracking, catalysts, materials, research, automation, supply chain management, satellite and cloud infrastructure.