Qatar is the largest exporter of liquefied natural gas (LNG) in the world. However, as advanced production technologies open up new reserves of oil and gas around the globe, up-and-coming gas producers such as the United States and Australia could eventually rival Qatar in LNG exports. Since Qatar is also important from a U.S. security perspective, given its strategic position in the Persian Gulf and its willingness to host American troops, some might worry the United States’ shift from consumer to competitor could hurt its relationship with Qatar and, as a result, weaken its military position in the broader Middle East.
Qatar is an important player in the global natural gas market. It is the largest exporter of LNG and hosts the biggest gas-to-liquids facility in the world. It also boasts the third-largest proved reserves of natural gas, totaling 885 trillion cubic feet. Though Qatar’s domestic energy demand is growing, the country still exports about 85% of its natural gas.1
Most of Qatar’s natural gas reserves are housed in the North Field, a mostly offshore formation that, combined with Iran’s South Pars field, makes up the world’s biggest non-associated natural gas field. Though ongoing exploration in Qatar’s shallow and deep waters could yield further finds, it is unlikely that another gas field as large as the North Field will be discovered in Qatar.
Qatar’s contribution to the world oil market is less significant than its role in natural gas. Qatar is the second-smallest producer of oil in OPEC, though it still ranks 13th in the world for proven oil reserves. Qatar’s territory only spans about 12,000 square kilometers, meaning that its oil production is highly concentrated;2 about 85% of its oil production comes from three main oil fields.
The U.S. Navy works closely with Qatar to secure the Persian Gulf and coordinate defensive efforts in the region. Qatar also plays host to the U.S. CENTCOM forward headquarters and actively supports U.S.- and Nato-led military operations.
As the United States has ramped up its own domestic production of shale gas, it has reduced its imports of gas from important producers such as Qatar. Not only that, but experts predict that the United States is on track to become a major exporter of energy, including LNG. Many worry that the dramatic shift in U.S.-Qatari gas trade and the potential future rivalry for shares of the global LNG market could make Qatar less willing to cooperate militarily with the United States. Given Qatar’s strategic position in the Persian Gulf and, more broadly, the Middle East, a cooling of U.S.-Qatari ties could be a severe blow to the U.S. military’s position in the region.
However, this outcome is unlikely. Qatar has many other, more important motives for maintaining a strong security relationship with the United States that have nothing to do with energy trade. Indeed, the two countries signed a new 10-year defense cooperation pact in December 2013, under which U.S. troops will train Qatari forces in exchange for air base access, despite their diminishing energy trade ties. In addition, Qatar has had no trouble finding other markets for its gas as U.S. imports have declined; now, it simply sends the bulk of its LNG exports to consumers in Asia and Europe.