UAE withdraws from OPEC and OPEC+, effective May 1

[noumoe]

UAE withdraws from OPEC and OPEC+, effective May 1: "As a country that has no obligations under the organization, this will provide us with flexibility," said UAE Energy Secretary.

The United Arab Emirates announced Tuesday it is quitting OPEC and OPEC+, dealing a heavy blow to the oil exporting groups and their de facto leader Saudi Arabia, effective May 1.


The exit comes amid the Iran war that has caused a historic energy shock and unsettled the global economy. Loss of the longstanding member could create disarray inside the cartel and weaken its united front on production quotas and geopolitics.


UAE Energy Minister Suhail Mohamed al-Mazrouei told Reuters the decision followed a careful look at the country’s energy strategies and current and future policies related to level of production.


He confirmed the UAE did not raise the issue with Saudi Arabia or any other country. “This is a policy decision, it has been done after a careful look at current and future policies related to level of production,” the energy minister said.


OPEC Gulf producers have already been struggling to ship exports through the Strait of Hormuz because of Iranian threats and attacks against vessels. Mazrouei said the move would not have a huge impact on the market because of the situation in the strait.


The withdrawal represents a clear win for President Donald Trump, who has accused OPEC of “ripping off the rest of the world” by inflating oil prices and has linked U.S. military support for Gulf states to demands for lower oil prices.


It follows sharp UAE criticism of fellow Arab states for failing to protect it from repeated Iranian attacks during the war. Diplomatic adviser Anwar Gargash said the Gulf Cooperation Council’s political and military response “has been the weakest historically,” adding he was surprised by the lack of solidarity.

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