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Qatar hosts first summit of Gas Exporting Countries Forum

November 15, 2011 - DOHA

The leaders of the Gas Exporting Countries Forum (GECF) convene for the first summit of the 10-year-old organization. Debate has intensified within the body about the benefits and price of achieving cartel-like collaboration to fix the price of natural gas, and to peg the price of gas to the price of oil. The summit will be watched for movement toward or away from these options. Qatar Emir Sheikh Hamad bin Khalifa al-Thani will preside. The forum will hold its 13th ministerial meeting on Nov 13 to fine-tune the summit agenda.

The leaders of the Gas Exporting Countries Forum (GECF) convene for the first summit of the 10-year-old organization. Debate has intensified within the body about the benefits and price of achieving cartel-like collaboration to fix the price of natural gas, and to peg the price of gas to the price of oil. The summit will be watched for movement toward or away from these options. Emir Sheikh Hamad bin Khalifa al-Thani will preside. The forum will hold its 13th ministerial meeting on Nov 13 to fine-tune the summit agenda. The GECF met for the first time in Tehran in 2001 and ministers have met annually since then. In Dec 2008, the GECF agreed on a charter and on where headquarters would be set up. They also agreed the body should be a "gas OPEC." In Nov 2010, Qatar renewed calls by exporters of natural gas for a mechanism to link pricing for the commodity to oil prices to ensure stability in the market. The Qatar-based GECF describes itself as a gathering of the world's leading gas producers aimed at representing and promoting their mutual interests. It was set up with the objective of increasing the level of coordination and strengthening the collaboration between member countries to fix prices. Consumers are widely said to be nervous about a "gas OPEC," but there might be little need. Analysts cited in the Wall Street Journal argue that a cartel for natural gas makes far less sense than a cartel for oil because gas exports generally require the construction of capital-intensive pipelines and contracts are signed over long-term periods. Oil exports, they say, are generally based on a spot market price to the barrel for delivery within relatively short timeframes. There is also the question of the market. Several sources say the supply is up and demand is down, in part because of the global recession. The forum groups Russia, the world's biggest gas producer, with other gas-rich states such as Iran and Qatar. The other countries listed by the organization as full members are: Algeria, Bolivia, Egypt, Equatorial Guinea, Libya, Nigeria, Trinidad and Tobago and Venezuela. Norway, Kazakhstan and The Netherlands have GECF observer status. Russia, Iran, Qatar, Venezuela and Algeria between them control nearly two-thirds of the world's gas reserves and account for 42 percent of its production.

2nd IEF-IGU Ministerial Gas Forum concluding statement (30 Nov 2010)

Qatar to host first gas summit next year (Peninsula 3 Dec 2010)

Gas Exporting Countries Forum

Gas exporting states agree Qatar-based 'gas OPEC' (AFP 23 Dec 2008)

Qatar renews call to link gas prices to oil (AFP 30 Nov 2010)

Date written/update: 2011-11-15