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United Arab Emirates to leave OPEC on May 1, in a decision that pressures the world’s largest oil exporting group, hits Saudi Arabia, and reinforces the country’s pursuit of more investment and its own energy production.
The United Arab Emirates is set to leave OPEC on May 1, amid the war in the Middle East. The decision was announced this Tuesday (28) by the state agency WAM and marks a significant change in the country’s relationship with the oil exporting group.
OPEC exit aligns with the Emirates’ strategy
The decision is linked to the long-term strategic and economic vision of the United Arab Emirates. The statement also cites the development of the country’s energy sector and the acceleration of investments in domestic energy production.
The exit comes after years of pressure from the Emirates for higher production quotas within OPEC. The country sought to expand its production capacity to levels above those assigned by the group.
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Move hits group led by Saudi Arabia
The Emirates’ departure represents a blow to OPEC and to Saudi Arabia, the organization’s main member. The group collectively accounts for 36% of the world’s oil production.
In addition to its share in production, OPEC controls nearly 80% of the world’s total proven oil reserves. Therefore, the Emirates’ decision carries weight within the global structure of the sector.
Emirates had been part of OPEC since the 1960s
OPEC was founded in 1960 by Saudi Arabia, Iran, Iraq, Venezuela, and Kuwait. The United Arab Emirates joined the organization seven years later.
With the scheduled exit on May 1, the Emirates end a long presence in the group. The decision reinforces the country’s priority to expand its own investments and redefine its energy role outside of OPEC.
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