The United Arab Emirates has announced on Tuesday, that it is exiting OPEC and OPEC+ (Organization of the Petroleum Exporting Countries), a move that significantly weakens the oil alliances and their de facto leader, Saudi Arabia, especially as tensions linked to the Iran conflict continue to disrupt global energy markets and shake economic stability.
Its exit is widely seen as a move that could pave the way for increased oil production, although uncertainties remain around how quickly additional supply can reach global markets, especially with disruptions affecting the Strait of Hormuz.
“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,” its state-run news agency said.
Despite short-term disruptions, the UAE emphasized confidence in long-term energy demand trends.
“While near-term volatility, including disruptions in the Arabian Gulf and the Strait of Hormuz, continues to affect supply dynamics, underlying trends point to sustained growth in global energy demand over the medium to long term,” the UAE added in the statement posted to the website of its state-run news agency.
Meanwhile, global oil prices have reacted sharply to the developments. U.S. crude oil crossed the $100 per barrel mark for the first time since April 10, climbing to nearly $102 in early trading. Similarly, Brent crude surged to about $113 per barrel.
The spike in prices has also been fueled by stalled negotiations between the United States and Iran. Earlier optimism had briefly eased market pressure after a ceasefire announcement on April 7, which saw Brent prices drop by over 17% before tensions resurfaced.
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