The United Arab Emirates said on Tuesday it was quitting OPEC and OPEC+, dealing a heavy blow to the oil exporting groups and their de facto leader, Saudi Arabia, at a time when the Iran war has caused a historic energy shock and unsettled the worldwide economy.
The lack of the UAE, a longstanding OPEC member, could create disarray and weaken the group, which has often sought to point out a united front despite internal disagreements over a variety of issues from geopolitics to production quotas.
UAE Energy Minister Suhail Mohamed al-Mazrouei told Reuters the choice was taken after a careful take a look at the regional power’s energy strategies.
Asked whether the UAE consulted with Saudi Arabia, he said the UAE didn’t raise the problem with some other country.
“It is a policy decision, it has been done after a careful take a look at current and future policies related to level of production,” said the energy minister.
OPEC Gulf producers have already been struggling to ship exports through the Strait of Hormuz, 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.
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Mazrouei said the move wouldn’t have a big impact available on the market due to the situation within the strait.
However the UAE exit from OPEC represents a win for U.S. President Donald Trump, who has accused the organization of “ripping off the remainder 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 got here after the UAE, a regional business hub and one among Washington’s most significant allies, criticized fellow Arab states for not doing enough to guard it from quite a few Iranian attacks through the war.
Anwar Gargash, the diplomatic adviser for the UAE president, criticized the Arab and Gulf response to the Iranian attacks in a session on the Gulf Influencers Forum on Monday.
“The Gulf Cooperation Council countries supported one another logistically, but politically and militarily, I feel their position has been the weakest historically,” Gargash said.
“I expect this weak stance from the Arab League and I’m not surprised by it, but I haven’t expected it from the (Gulf) Cooperation Council and I’m surprised by it,” he said.