The UAE has left OPEC after more than 50 years, threatening further instability for the world’s oil markets. The UAE announced it will leave the oil cartel effective May 1.
Officials from the UAE had long raised the possibility of leaving the cartel, arguing that its quotas had unfairly limited the country’s oil exports. Breaking a five-decade membership the UAE said the move reinforces their commitment to a “forward-looking role in global energy markets”. “This decision reflects the UAE’s long-term strategic and economic vision and evolving energy profile, including accelerated investment in domestic energy production, and reinforces its commitment to a responsible, reliable, and forward-looking role in global energy markets,” the UAE said.
“Following its exit, the UAE will continue to act responsibly, bringing additional production to market in a gradual and measured manner, aligned with demand and market conditions,” the country added.
The loss of a key producer could weaken OPEC’s control over oil market stability and could further divide the group. The move signals rising friction with Saudi Arabia, which has long steered the group’s oil policy.
Saudi Arabia and the UAE increasingly have competed over economic issues and regional politics, particularly in the Red Sea area
President Donald Trump has been highly critical of the OPEC in the past and UAE’s exit could be seen as a win for the 79-year-old.
In 2018 he told the U.N. General Assembly that OPEC is “ripping off the rest of the world” by pushing oil prices higher.
He told a gathering of world leaders: “OPEC and OPEC nations are as usual ripping off the rest of the world, and I don’t like it. Nobody should like it.”
Founded by Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela, OPEC currently controls about 79% of the world’s proven oil reserves and produces over a third of its crude oil.
