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Arab countries cut ties to Qatar for ‘supporting terrorism’, send oil prices higher

Saudi Arabia, Egypt, Bahrain, the United Arab Emirates and Yemen have cut diplomatic ties with Qatar, accusing it of destabilising the region. They say Qatar backs militant groups including so-called Islamic State (IS) and al-Qaeda, which Qatar has denied. The dispute with Qatar, the world’s top seller of liquefied natural gas (LNG) sends shockwaves through the energy industry.

The Saudi state news agency SPA said Riyadh had closed its borders, severing land, sea and air contact with the tiny peninsula of Qatar.

Qatar called the decision “unjustified” and with “no basis in fact”.

The unprecedented move is being seen as a significant split between powerful Gulf countries, who are also close US allies.

It comes in the context of increased tensions between Gulf countries and their near-neighbour Iran. The Saudi statement accused Qatar of collaborating with Iranian-backed militias.

What has happened?

The diplomatic withdrawal was put into motion by Bahrain then Saudi Arabia early on Monday. Their allies swiftly followed.

SPA cited officials as saying the decision was taken to “protect its national security from the dangers of terrorism and extremism”.

The three Gulf countries have given Qatari nationals two weeks to leave their territory.

The UAE has given Qatari diplomats 48 hours to leave the country.

Abu Dhabi accuses Qatar of “supporting, funding and embracing terrorism, extremism and sectarian organisations,” state news agency WAM said.

UAE airlines Etihad Airways, Emirates and Flydubai said they would suspend all flights to and from Qatari capital Doha from early Tuesday, local time.

The Gulf allies said they had closed their airspace to Qatar Airways.

Later also The Maldives and Libya’s eastern-based government have also cut diplomatic relations with Qatar.

Energy industry

The Qatar dispute sent oil prices higher, may impact LNG supplies, Reuters reports.

Qatar is the world’s largest supplier of liquefied natural gas (LNG) and a major seller of condensate – a low-density liquid fuel and refining product derived from natural gas.

“(Qatar) embraces multiple terrorist and sectarian groups aimed at disturbing stability in the region, including the Muslim Brotherhood, ISIS (Islamic State) and al-Qaeda, and promotes the message and schemes of these groups through their media constantly,” Saudi state news agency SPA said.

The rift did not immediately affect tanker shipments, but benchmark Brent crude futures prices rose around 1 percent to over $50 per barrel on concerns about a widening rift in the Arab world.

The move comes as the Organization of the Petroleum Exporting Countries (OPEC), of which Saudi Arabia, the UAE and Qatar are members, recently agreed to extend crude oil production cuts in order to tighten the market and pop up prices.

It was not immediately clear how the political crisis would affect policy-making at OPEC, of which Saudi Arabia as the world’s biggest crude exporter is seen as the de-facto leader.

A Saudi oil industry source said the action was unlikely to have a large impact on OPEC decision making, noting that other political disputes within the group, including between Saudi Arabia and Iran, had not prevented OPEC from agreeing on oil policy.

Suddenly …Qatar

While the severing of ties with Qatar was sudden, it has not come out of the blue, as tensions have been building for years, and particularly in recent weeks.

According to BBC, two weeks ago, the same four countries blocked Qatari news sites, including Al Jazeera. Controversial comments purportedly by Qatari emir Sheikh Tamim bin Hamad al-Thani criticising Saudi Arabia appeared on Qatari state media.

The government in Doha dismissed the comments as fake, attributing the report to a “shameful cybercrime”.

Back in 2014, Saudi Arabia, Bahrain and the UAE withdrew their ambassadors from Qatar for several months in protest over alleged interference in their affairs.

Then … this!

John Podesta was former chairman of the 2016 Hillary Clinton presidential campaign. He previously served as chief of staff to President Bill Clinton and Counselor to President Barack Obama.

Qatar hosts the largest US military base in the Middle East

The United States maintains its biggest concentration of military personnel in the Middle East at Qatar’s Al Udeid Air Base.

The sprawling base 20 miles southwest of the Qatari capital of Doha is home to some 11,000 US military personnel.

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