Qatar Petroleum and Shell have canceled plans for their $6.4 billion Al Karaana petrochemical project in the Gulf state, blaming "the current economic climate in the oil industry," touched off by falling prices.

The two companies in 2011 had agreed to build the complex in Ras Laffan Industrial City, in an 80:20 joint venture. In a joint statement this week they said prices quoted by contractors to build the complex showed the project was "commercially unfeasible."

The project pursued by the Qatari state-owned and the Dutch oil and petrochemicals group is one of several oil-related ventures to be shelved since the end of 2014.

Saudi Arabia's state oil giant Saudi Aramco is believed to have put a $2 billion clean fuels plant at its largest oil refinery in Ras Tanura on hold. Premium and Statoil also are rethinking plans.

Many other multi-billion dollar projects in the region are still going ahead, however, including the $20 billion joint venture petrochemical complex Sadara of Aramco and Dow Chemical.

Observers said the Qatar-Shell project had begun to look shaky even before oil prices started to tumble. Requests for banks to help finance it were due to be sent out by the end of the first quarter last year, but were not sent. They added that changes in the industry and shifting demand projections could be to blame, in addition to the price deterioration.