Trump Heralds More Good News With the UAE Pulling Out of OPEC

AP Photo/Alex Brandon

The United Arab Emirates (UAE) made a big move this week, and it went beyond the military action against Iran. 

They finally pulled out of the Organization of the Petroleum Exporting Countries (OPEC) and OPEC+. OPEC is basically a pricing cartel that allows them to have some control over the market, rather than letting the free market dictate. This departure weakens the cartel, and that's a great thing for all of us. 

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The departure frees the UAE from group production quotas, giving it greater flexibility to increase output and expand its role across crude, petrochemicals and natural gas markets. Officials signaled the shift is aimed at positioning the country for long-term global energy demand growth.

UAE Energy Minister Suhail al-Mazrouei told Reuters the decision followed a "careful look" at national energy strategy and was a "sovereign national decision" grounded in long-term economic priorities. He said operating outside the group will allow the UAE to better meet future global demand.

"Being a country with no obligation under the group will give us flexibility," al-Mazrouei said, adding the move comes at a time when global consumers require stable supply and strategic reserves are being drawn down.

They want to produce up to 5 million barrels per day, as opposed to 3.5 million that they are allowed under OPEC now. 

Before the war, the Trump administration looked to Middle East producers to boost output to help reduce oil prices. In the future, the U.A.E could more easily comply with such requests if it’s no longer in OPEC.

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So this move is likely to both increase the supply and drop the prices. 

On Wednesday, President Donald Trump praised the move.

“I think it’s great,” Trump told reporters at the White House after meeting with Artemis II astronauts.

UAE President Sheikh Mohamed bin Zayed Al Nahyan is “very smart,” said Trump, “and he probably maybe wants to go his own way. That’s a good thing.”

“I think ultimately it’s a good thing for getting the price of gas down, getting oil down, getting everything down,” Trump said, adding, “they’re having some problems in OPEC.”

This is also another direct hit at Iran, which is part of OPEC and was already being squeezed into oblivion by the U.S. blockade. 

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READ MORE: Trump Turns the Screws on Iran After Their Last Offer

Iranian President's Plaintive Plea to the People Shows What Deep Trouble They Are In


UAE was unhappy that it kept getting bombed by Iran, but its alleged allies in the Gulf Cooperation Council countries weren't stepping up enough for them politically or militarily. Now this gives the UAE greater freedom to do whatever it wants without their restrictions.  

The Iranian regime, by attacking the UAE, might have helped hastened its own demise. 

Editor's Note: For decades, former presidents have been all talk and no action. Now, Donald Trump is eliminating the threat from Iran once and for all. 

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