Abu Dhabi, United Arab Emirates. The United Arab Emirates said on Tuesday it was quitting OPEC, citing a review of its energy strategy as an energy crisis linked to the Iran war exposes discord among Gulf nations.
Decision to leave OPEC and OPEC+
UAE Energy Minister Suhail Mohamed al-Mazrouei told Reuters the decision was taken after a careful look at the country’s energy strategies. He said the UAE did not raise the issue with any other country when asked whether it consulted OPEC’s de facto leader, Saudi Arabia.
“This is a policy decision, it has been done after a careful look at current and future policies related to level of production,” Mazrouei said.
Impact on the oil market and Strait of Hormuz disruptions
The loss of the UAE, a longstanding OPEC member, could create disarray and weaken the group, which has usually sought to show a united front despite internal disagreements over issues including geopolitics and production quotas.
Mazrouei said the move, in which the UAE will also leave the OPEC+ grouping, would not have a huge impact on the market because of the situation in the Strait of Hormuz. OPEC Gulf producers have been struggling to ship exports through the strait, a chokepoint between Iran and Oman through which a fifth of the world’s crude oil and liquefied natural gas normally passes, due to Iranian threats and attacks against vessels.
Political context and regional tensions
The UAE’s exit from OPEC was described as a win for U.S. President Donald Trump, who in a 2018 address to the U.N. General Assembly accused the organisation of “ripping off the rest of the world” by inflating oil prices. Trump has also linked U.S. military support for the Gulf with oil prices, saying that while the U.S. defends OPEC members they “exploit this by imposing high oil prices”.
The move followed UAE criticism of fellow Arab states for not doing enough to protect it from numerous Iranian attacks during the war.
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