The United Arab Emirates on Tuesday said it will leave OPEC and the broader OPEC+ alliance, effective from May 1. Though there were rumours about UAE leaving the group, this is the first time that the Emirates officially acknowledged the move.
Why did UAE leave OPEC?
Reports suggest that one of the key reasons behind the UAE exit is the restrictions on oil production. However, the deteriorating ties with fellow GCC member Saudi Arabia is also cited as a key reason.
The UAE said the decision "reflects [its] long-term strategic and economic vision and evolving energy profile, including accelerated investment in domestic energy production," reports the state-run WAM news agency. The country emphasised that it would continue to act responsibly in the oil market, adding production "gradually and in line with demand and market conditions."
The emirate of Abu Dhabi joined the OPEC in 1967. In 1971, when the UAE was formed, the country officially became a full member of the group.
In recent years, however, the UAE has pursued independent foreign and economic policies, occasionally clashing with Riyadh as Saudi Arabia sought to directly challenge the UAE by trying to woo foreign investment.
Recently, the ties between the UAE and Saudi Arabia hit a new low after Riyadh carried out an airstrike on Yemen's Mukalla port, contending that vessels carrying weapons and military vehicles from the UAE were heading to the Southern Transitional Council (STC).
The STC posed threat to Saudi-backed Presidential Leadership Council (PLC) in Yemen and Riyadh clearly did not want a potential UAE-backed state to risk its border security. Following the airstrike, the UAE has withdrawn its forces, but its relations with Saudi remains sore.
