"Today, nothing depends on the OPEC+ statements on the global oil market"

Alexey Gromov, Principal Director on Energy studies at the Institute for Energy and Finance, commented on the UAE's withdrawal from OPEC and OPEC+ to Business FM:

"It seems to me that the decision of the United Arab Emirates to withdraw from the OPEC+ alliance and from the OPEC structure was expected, because the United Arab Emirates has been accumulating contradictions with Saudi Arabia for quite a long time on policy issues of both the OPEC+ alliance and the OPEC oil cartel. It was primarily about issues related to the policy in the field of production restrictions. The UAE was ready to produce more, and they were less dependent than Saudi Arabia on fluctuations in the oil market and prices. Therefore, these contradictions from the point of view of the policy of production restrictions have existed over the past few months, not even months, but years. Just a few days ago, the United Arab Emirates requested financial assistance from the United States in connection with the consequences of the conflict in the Middle East and the blocking of the Strait of Hormuz. I do not rule out that one of the conditions for receiving such assistance from the United States was the recommendation of the American authorities to withdraw from OPEC+ and OPEC for the United Arab Emirates. Well, the most important reason is actually that in the conditions of blocking the Strait of Hormuz, the market power of OPEC+ and the member countries of this alliance is reduced to zero. Because today, nothing depends on the statements of OPEC+ on the global oil market: the bulk of the global oil supply, which is controlled by OPEC+, is concentrated in the Persian Gulf countries, and it is impossible to export this oil from this region. And it turns out that the Persian Gulf countries are suffering from restrictions not only on exports, but also on production. In this situation, in general, the OPEC+ alliance has at least temporarily lost its market power."