The United Arab Emirates (UAE) has announced its withdrawal from the Organization of the Petroleum Exporting Countries (OPEC) and OPEC+, the alliance that aims to control global oil supply and stabilize market prices.The UAE’s decision could create market instability in the short term, while also signaling structural changes in the energy sector in the long term.
Qatar-based media outlet Jazeera reported that the UAE’s move is seen as a major blow to the alliance of oil exporting countries.This is a significant challenge, especially for Saudi Arabia, the unofficial leader of the coalition. The decision comes at a time when tensions over Iran have destabilized global energy markets and the global economy is under pressure.
Oil exports in the Gulf region are already facing various obstacles, especially the disruption of shipping through the vital Strait of Hormuz.In normal times, about a fifth of the world’s crude oil and liquefied natural gas passes through this route. However, recent threats from Iran and attacks on ships have increased the risk on this route.
Analysts say political discontent also played a role in the UAE’s decision. The country has complained that it has not received the security support it expected from other Arab countries despite facing attacks from Iran. It is worth noting that the UAE has long been known as a close ally of the United States.
OPEC, founded in 1960, is one of the most influential alliances in global oil supply, controlling more than one-third of the world’s total oil production.
Before the UAE’s announcement, the alliance had 12 members. However, with their withdrawal, the current number of members has dropped to 11. OPEC’s current member countries are Saudi Arabia, Algeria, Iran, Libya, Iraq, Kuwait, Venezuela, Nigeria, Gabon, the Republic of Congo, and Equatorial Guinea.