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UAE quits OPEC, shaking global oil alliance

The United Arab Emirates (UAE) has announced its decision to leave the Organization of the Petroleum Exporting Countries (OPEC) and the broader OPEC+ alliance, marking a major shift in global energy politics. The exit will take effect from May 1, 2026.

According to official statements reported by multiple international outlets, the UAE described the move as part of a long-term strategic and economic realignment of its energy policy. The country said it intends to focus on national interests, expand domestic production capacity, and respond more flexibly to global energy demand.

The UAE, one of the largest oil producers within OPEC and a key Gulf member, has been part of the organization for decades. Its departure is being viewed as a significant blow to the group’s cohesion and its ability to influence global oil supply and pricing.

Reports indicate that the decision comes at a time of heightened global energy instability. The ongoing conflict involving Iran and disruptions in the Strait of Hormuz, a critical passage for global oil shipments, have already tightened supply routes and increased volatility in crude markets. The UAE’s exit adds further uncertainty to an already fragile situation.

Analysts suggest the move could allow the UAE greater freedom to adjust production levels outside OPEC quotas, potentially increasing output in response to market conditions. However, it also weakens coordinated supply management within the oil-exporting bloc traditionally led by Saudi Arabia.

The decision has also been linked in reports to growing policy differences between Gulf producers over production targets and long-term energy strategy. While some members favour tighter coordination to stabilize prices, others, including the UAE, appear to be prioritising production flexibility and investment expansion.

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OPEC+ to raise May oil output despite supply risks

The Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, has decided to raise its oil production quotas for May by 206,000 barrels per day (bpd), continuing a cautious increase amid ongoing market uncertainty.

The announcement came after a virtual meeting of key members including Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria, and Oman. OPEC+ said the increase is aimed at supporting market stability as global oil markets face disruptions due to geopolitical tensions.

However, the cartel warned that actual output might not rise fully. Damage to energy infrastructure and the closure of the Strait of Hormuz, a vital oil shipping route, have limited the ability of some countries to export crude. Repairs to damaged facilities are expected to be expensive and take time, adding to supply risks.

The Strait of Hormuz, through which a significant portion of the world’s oil passes, has been affected by regional conflicts, reducing the practical supply even if quotas are raised.

Global oil prices have already been responding to these risks. Brent crude has been trading near $120 a barrel, pushed higher by fears of disrupted shipments and damaged infrastructure. Analysts warn that without improvements in supply flow, prices could remain elevated.

OPEC+ emphasized the importance of protecting shipping routes and energy infrastructure to keep oil flowing smoothly to international markets. While the quota increase signals readiness to produce more, the group said it will continue to monitor supply conditions and adjust output if needed.

The cartel’s monitoring committee will next meet in June, but OPEC+ remains prepared to convene sooner if market conditions change unexpectedly.

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Oil prices climb as OPEC+ keeps production steady

Oil prices jumped on Monday after OPEC+ announced it would maintain current production levels through early 2026. This cautious approach comes as the world watches supply and demand closely.

Brent crude rose to $63.32 per barrel, while West Texas Intermediate (WTI) edged up to $59.45 per barrel, both gaining around 1.5%. The move signals that OPEC+ is prioritizing market stability over boosting output.

Analysts say the decision reflects growing concerns about potential supply shortages and global uncertainties, including pipeline disruptions and geopolitical tensions affecting oil routes. Traders reacted quickly, pushing prices higher as the market adjusted to the news.

In simple terms, OPEC+ has hit the pause button on pumping more oil, and the market responded with a noticeable uptick in prices, showing just how sensitive oil markets are to production decisions.

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