Will the Organization of Gas Exporting Countries (OGEC) have the same power as OPEC?

Abstract

Abstract:Gas,as an important source of energy and as a clean fuel,is a very strategic commodity,perhaps
this is why gas-owners are trying to maximize the potential use of this important energy source through
the OGEC.the research attempts to answer a fundamental question,whether it is capable of becoming a
monopoly power similar to OPEC?in response to this question,the similarities and structural differences
between the two organizations have been examined and has been concluded that:although OGEC and
OPEC,both in structure and in objectives,are very similar to each other.however,none these of similarities
can turn OGEC into a powerful cartel like OPEC.there are many barriers that do not allow OGEC to make
a powerful cartel.on the one hand,the oil and gas economy has fundamental differences with each
other,for example,unlike oil,gas has a regional market,not a global one;because,the cost of transport is so
high that its transmission is not costly in long distance.construction of pipelines also requires long
negotiation between exporting and importing countries and beneficiary countries in the transit route of
gas;therefore, the seller and the buyer must be sure that their sales or purchases are secured in more than a
decade.although OGEC’s members have seventy-five percent of the world’s gas reserves,but the huge gas
reserves will not guarantee the success in the global market.because,if the goal is to create a monopoly
organization for gas exports,the organization can not control the price and quantity of gas supplied in the
global market without the ability to transport natural gas easily and efficientlyin addition, oil especially in
transportation is a non-replaceable commodity,while there are alternative sources of gas for production
units.on the other hand,OGEC’s inability to maintain its independence from the OPEC,as well as,the
heterogeneity of the member countries in their priority areas and their different production capacities,has
caused serious problems in creating a cartel in the gas field..it seems that the formation of this
organization was only the result of Russia’s efforts to maintain the monopoly of the European gas
market.apparently,Russia’s serious attempts to cooperate with Algeria,the world’s fourth largest gas
exporter,as well as an important gas exporter to Europe,have been for this reason.