UAE’s OPEC Exit Unlikely To Move Global oil Prices -- Economist

KUALA LUMPUR, April 30 (Bernama) -- The United Arab Emirates’ (UAE) exit from the Organisation of the Petroleum Exporting Countries (OPEC) and its OPEC+ allies is not expected to significantly affect global oil prices, which are currently driven more by geopolitical factors.

Economist Dr Jomo Kwame Sundaram said that oil prices are no longer determined solely by OPEC but are now more influenced by global uncertainty following the West Asia conflict.

“OPEC does not really determine the current oil price movements. It is more affected by war and war tactics, not only (perpetrated) by Iran, but also by the United States.

“However, it is clear that the UAE is now not taking sides with other producing countries, and this (affects) unity among producing (countries) to try to work together on influencing oil prices,” he said.

He said this to reporters after attending the Allianz Centre for Governance Speaker Series session titled “The New World Order Is Not Order, Let Alone New” here today.

Jomo said the long-term implications of the UAE’s move on the world oil market, including for Malaysia, remain limited.

“However, (what is important) in every analysis is that we need to always take into account the current situation, understand what has happened, and assess the possibilities of what will happen in the future,” he explained.

Earlier, the UAE reportedly announced on Tuesday its decision to exit OPEC and OPEC+, significantly impacting the unit of the oil-exporting countries' grouping.

The decision was made amid the ongoing US-Iran conflict, which has caused the largest energy supply shock risk and pressured the global economy. 

-- BERNAMA