Concerns over global crude‑oil supplies intensified on Tuesday after the United Arab Emirates announced that it will withdraw from OPEC and OPEC+ effective Friday. The decision, conveyed by the state news agency WAM, cites the UAE’s “long‑term strategic and economic vision” and a need to focus on “national interests.”
The UAE, one of the world’s leading oil producers, has previously resisted OPEC production quotas. In a statement the emirate said it had made “significant contributions and even greater sacrifices” during its membership but now must prioritize its own energy policy.
The announcement comes as oil prices continue to climb. Brent June futures rose 1 % to $112.37 a barrel, marking an eighth consecutive day of gains, while July contracts were up 0.88 % at $105.32. U.S. West Texas Intermediate (WTI) for June increased 0.51 % to $100.44 a barrel after a 3.7 % jump in the prior session.
Price pressure is also being driven by developments in the Persian Gulf. The Wall Street Journal reported that U.S. President Donald Trump has directed officials to prepare for an extended blockade of Iranian ports, a move that would further restrict oil shipments through the Strait of Hormuz. Analyst Yang An of Haitong Futures told Reuters that a prolonged blockade would exacerbate supply disruptions and sustain higher oil prices.
Market participants are assessing the impact of the UAE’s exit from OPEC. Analysts say the immediate effect on supply is likely limited, but in the medium term the departure could increase available crude and push the Brent forward curve deeper into backwardation, according to ING. The organization added that a resolution allowing unhindered flow through the Strait of Hormuz is essential before the UAE can increase output.
The Strait of Hormuz, which carries roughly 20 % of global oil and LNG supplies, remains shut after Iran’s recent closure and the United States’ port blockade. The shutdown has prompted draws from global inventories; the American Petroleum Institute reported a decline of 1.79 million barrels in U.S. crude stocks for the week ending 24 April, with gasoline and distillate inventories falling 8.47 million and 2.60 million barrels respectively.
Jorge Leon, head of geopolitical analysis at Rystad Energy and former OPEC officer, noted that the United States continues to pressure Iran over its nuclear programme, while Tehran seeks sanctions relief and a role in managing the Hormuz corridor.
The combination of the UAE’s OPEC departure and escalating geopolitical tension in the Gulf underscores the fragility of oil markets. Observers will watch closely for diplomatic moves that could reopen the Strait of Hormuz and stabilize supply dynamics.
