UAE exits OPEC amid regional tensions, reshaping oil blocs; OPEC still a cartel of top producers coordinating supply and markets.
Eight OPEC+ countries, including Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman, have agreed to increase oil production by 206,000 barrels per day starting in May 2026. The move follows a recent surge in oil prices caused by the closure of the Strait of Hormuz, which has disrupted exports from key Gulf producers. Nigeria remains sidelined due to its inability to meet quotas. The decision reflects a cautious approach to market stability as disruptions continue.
The United Arab Emirates has announced it has withdrawn from OPEC and the OPEC+ alliance effective May 1, saying a review of its production policy and expanded domestic capacity require greater national control. The move removes a major spare-capacity holder and will weaken OPEC's ability to stabilise global oil supply when Gulf shipping resumes.
The UAE has exited OPEC and is re-evaluating its multilateral commitments, signaling a shift in Gulf dynamics. Riyadh and Abu Dhabi remain economically intertwined despite strategic disagreements, with both states prioritizing autonomy and continued trade.
The UN World Food Programme has warned that higher oil prices and disrupted trade have pushed an extra 2.5 million people in Somalia, 2.3 million in Afghanistan and 1.3 million in Sri Lanka into acute food insecurity, and that up to 45 million more people globally could face hunger if fuel stays near $100 a barrel through June 2026. The agency has also reported funding shortfalls that are forcing it to cut aid and will leave 1.5 million fewer people served this year.
Oil and petrol prices have fallen after the U.S. and Iran reached a tentative deal to reopen the Strait of Hormuz, but global inventories and U.S. strategic reserves have dropped to decades-low levels and will take months to rebuild. Consumers are seeing smaller pump prices now; wholesale and crude markets remain fragile while production, shipping and refinery capacity restart is underway.
The Strait of Hormuz remains a focal point as multiple sources indicate shifting dynamics in Gulf oil flows. Analysts say international pressure, sanctions, and ongoing fighting shape when and how Gulf oil will move, with some shipments reappearing while overall volumes stay depressed. The pace of mine clearance, lane re-opening, and fleet re-mobilization will determine when prewar flows resume.
U.S. and Iran have moved toward a final deal on ending fighting in Lebanon and reopening the Strait of Hormuz, while Tehran continues to press for economic benefits. Mediators report progress, but the region faces renewed instability as Declarations surface about the strait’s status.
APEC discussions have highlighted a widening gap between the US and China on trade, even as Beijing’s commitments to Boeing orders and US agricultural purchases signal ongoing economic ties. APEC ministers are urging faster implementation of agreed outcomes, with potential shifts as Xi and Trump are expected to meet later this year.
Oil prices extend declines after tankers exit the Strait of Hormuz, easing supply fears amid fresh Iran-US talks. Brent sits around $72.76, WTI near $69.84, with new estimates of ship movements and ongoing diplomatic efforts shaping market expectations.