Why a Gas Troika and Cartel Will Prove to be Hot Air

Despite fears that the world is about to see the formation of a Gas OPEC spearheaded by a 'troika' of Russia, Iran and Qatar, in reality, any process of cartelization remains a highly unlikely process due to structural impediments and geopolitical divides between producer states. This is not only the case for the troika, but also for the whole concept of a Gas Exporters Country Forum.

Scope of this report

• Awareness of political dynamics and market speculation dictating gas market fundamentals.
• Detailed discussion of GECF and the Gas Troika on cartelization prospects.
• Strategic analysis of gas market dynamics relating to fringe producers, LNG and key producer states.
• Critical analysis of power shifts taking place within the GECF and the impact on benchmark prices.

Research and analysis highlights

The formation of the forum was largely a reaction to liberalization within gas markets having increased uncertainty for exporters. Its initial attempts to block EU efforts to outlaw destination clauses that restrict the reselling of gas and to initiate gas-pricing change in Europe by ending the link to crude oil prices both ended in failure.

Russia, Qatar and Iran are all looking towards some form of market influence or control. But the problem is that such players don't really know how to get there, with blunt self interest and short term thinking likely to trump the cartelization process.

This is not to say that co-operation between key gas exporters is impossible. This particularly applies to Europe, whose dependence on Russian and Algerian gas is expected to increase to 60% by 2030. Potential co-operation between Russia and Algeria, Nigeria, Iran and Libya (and Qatar) is a space that the EU should continue to watch carefully.

Key reasons to read this report

• Understand how political factors within OPEC states will influence decisions on the oil price.
• Gain critical insight into oil market dynamics and how OPEC, non-OPEC producer relations will develop.
• Understand opportunities and threats that political risk will create for gas markets over the coming years. .

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