The decision was shocking. But the announcement April 28 that the United Arab Emirates was leaving OPEC caps years of tension where the desert state chafed under the cartel’s quotas, and recently, encountered severe strain in its relationship with Saudi Arabia, the group’s most potent force by far. Though it had felt strains before, it was the war in Iran that pushed the UAE over the edge. “The war suddenly made job one for the UAE: ‘Take the money and run,’” says Steve H. Hanke, professor of applied economics at Johns Hopkins University. “First, OPEC stood partially in the way. Now, the Iran war poses a much bigger danger for a long time to come.”
The UAE didn’t mention the Gulf conflict in its public announcement. Its press release stated: “The decision reflects the UAE’s long-term strategic and economic vision and evolving energy profile, including accelerated investment in domestic energy production.” Included was a confirmation that the UAE seeks to lift production beyond OPEC strictures—framed by understatement apparently designed to avoid freaking out the oil market. The UAE pledged to bring “additional production to the market in a gradual and measured manner, aligned with demand and market conditions.”
