OREANDA-NEWS. Gulf Co-operation Council (GCC) members Saudi Arabia, the UAE and Bahrain, as well as north African neighbour Egypt, have severed diplomatic ties with Qatar, citing alleged sponsorship of terrorist groups, including Isis and al-Qaida, and accusing Doha of undermining the sovereignty of its neighbours.

There has been no direct impact on the regional energy sector so far. Qatar has the world's third-largest gas resources after Russia and Iran, and is the largest exporter of LNG. Kuwait, the UAE and Egypt have all imported LNG cargoes from Qatar recently, and demand from those countries is growing amid rising domestic power consumption, particularly in summer.

Gas supplies to the UAE and Oman through the 3.2bn ft?/d (33bn m?/yr) Dolphin pipeline from Qatar have not been affected yet, according to operator Dolphin Energy. The company will issue a statement soon.

The UAE imports about 2.2bn ft?/d through the pipeline. The agreement is between Qatari state-owned QP and Dolphin Energy, a joint venture uniting UAE state-run investment firm Mubadala, Total and US independent Occidental Petroleum. Oman imports about 200mn ft?/d via Dolphin.

Saudi Arabia, the UAE and Bahrain have given their own nationals 14 days to leave Qatar and have given Qatari nationals 14 days to leave their respective countries. And they have closed all access to or from Qatar through their land, sea and air ports.

The diplomatic row comes two weeks after Saudi Arabia, the UAE, Bahrain and Egypt blocked access to Qatari state news amid claims of controversial comments by Qatari emir Sheikh Tamim bin Hamad al-Thani that appeared to criticise Riyadh. Qatar claims that its news websites were hacked.

GCC members Kuwait and Oman have so far not commented on the spat.

The freezing of diplomatic relations is likely to be economically challenging for Qatar as the tiny Mideast Gulf nation is a peninsula, sharing its sole land border with Saudi Arabia.

Qatar has faced significant economic headwinds since 2014 amid lower oil and gas prices, despite its vast natural resources and its global-leading GDP per head. Ratings agency Moody's cut Qatar's rating late last month.

Riyadh wants companies doing business in Saudi Arabia to sever ties with Qatar as well. A number of large oil companies, including ExxonMobil, Shell and Chevron, do business with both countries' respective state-owned oil firms Saudi Aramco and QP.