에미리트의 OPEC 탈출이 전쟁 후 석유 흐름을 촉진할 것

UAE’s defection will reduce the oil cartel’s influence over the global energy market and help make up for the billion barrels of oil lost because of the closure of the Strait of Hormuz.

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The United Arab Emirates’ defection from OPEC will change the nature of the postwar oil market, further weakening the cartel’s already-waning influence over the oil price.

While the timing of UAE’s exit from the oil cartel in the middle of the Iran war might have been a surprise, the departure has long been mooted as it became obvious that the country was increasingly frustrated by OPEC’s restrictions on its production.

Recent frictions between the UAE and the other regional power and the most powerful voice in OPEC, Saudi Arabia, over conflicts in Yemen, Sudan and Libya and how the war in Iran should be settled have added to the tensions between Abu Dhabi and Riyadh.

At the heart of the decision is a purely economic motivation. The UAE has invested heavily over the past decade or so in increasing its production capacity, which is currently about 4.85 million barrels of oil a day, with a target of 5 million barrels a day by next year and the potential to produce a lot more.

The Saudi-led OPEC+, however, has imposed quotas on its members in an attempt to put a floor under global prices. The UAE production cap is 3.447 million barrels a day, although it had been breaching that cap and producing oil at a rate of about 3.6 million barrels a day before the war erupted.

That gap between what it has been told to produce and what it could produce of more than a million barrels a day means that the UAE’s spare capacity lags only the Saudis’ 1.6 million barrels a day of underutilised capacity. As a proportion of its available capacity, however, the UAE’s is the largest of any OPEC member.

The UAE economy is more diversified and less oil-reliant on oil than the Saudis’, thanks to its investments in aviation, tourism and finance.

Where the Saudis – and other Middle East oil producers – need oil prices in the $US80 to $US100 a barrel range to balance their budgets, the UAE is less concerned about price than volume as it has massive reserves (more than 100 billion barrels) and its oil has a very low extraction cost. There’s a substantial opportunity cost – more than $US100 million a day – in producing below its capacity.

For the moment, the implications of its exit from OPEC for the oil price and market and for OPEC itself are academic while the war continues.

The UAE, like the Saudis, has a pipeline that circumvents the Strait of Hormuz, which Iran has closed with mines and the threat of missile and drone attacks. So it has been able to bypass the strait for some of its production.

The pipeline carries, however, a maximum of only about 1.9 million barrels a day. UAE is drawing up plans to expand that capacity, but it could take years before new pipelines could be operating.

Until the strait reopens, the UAE can bring only about half its full production capacity to bear on the market.

The timing of the announcement, which the country’s energy minister Suhail al-Mazrouei said was grounded on the UAE government’s long-term strategic and economic vision, was “right” because (with no practical ability to bring increased volumes to the market) it would have minimum impact on the other OPEC members.

If and when the strait does reopen, the world will need the extra UAE oil.

The strait’s closure has taken about 13 million barrels a day out of the market – the total volume lost is nearing a billion barrels – and forced the oil price up from around $US70 a barrel to more than $US110 a barrel this week. (That’s the price in the futures market. Oil for immediate delivery has been changing hands at prices above $US140 a barrel, reflecting shortages of the physical product.)

The price impact has been substantial, but it has been muted by the drawdowns of national strategic reserves and industry stocks, which will have to be replenished once the market functions more normally.

That will create a unique opportunity for the UAE (and the Saudis, for that matter) to sell a lot more oil without blowing up the price – it could take until well into next year before global supply and demand is reasonably balanced and prices stabilise, probably materially above their prewar levels.

If and when the market normalises, however, the additional UAE production could be expected to eventually lower prices relative to whatever they might otherwise have been, which Donald Trump (whose administration the UAE is close to) will no doubt hail as a vindication of his war.

It will also undermine OPEC+’s influence over the global market.

Even with the addition of Russia and others as associates within the enlarged OPEC+ cartel, OPEC’s share of the global market and its ability to control prices have been shrinking as the volumes of oil flowing out of the shale industry in the US have soared.

In the early 1970s, OPEC produced more than 50 per cent of the world’s oil. Today its market share is about 30 per cent. The UAE’s share is about 4 per cent, so its decision to leave the grouping cuts the OPEC share to 26 per cent and will reduce its influence further.

While there are those who see the UAE decision as an existential threat to OPEC and OPEC+, the Saudis and Russians are unlikely to give up their diminished influence over the market readily.

Unlike the UAE, which is interested in monetising its oil reserves as quickly as possible in anticipation of an eventual and substantial structural reduction in demand as the world electrifies, the Saudis and Russians, whose economies are far more reliant on energy sales, want to maximise the price and maintain production in the long term. The cartel is more important to them than to the UAE.

OPEC has survived defections before, albeit not as significant a member as the UAE, nor one whose membership has been so lengthy – the UAE joined OPEC in 1967, four years before its own founding. Indonesia, which left in 2016, Qatar (2019), Ecuador (2020) and Angola (2023) are all former members of the cartel.

Apart from the Saudis, other members of the cartel don’t have anything like the degree of spare capacity that has motivated the UAE. They don’t have the same incentive to leave.

When the market finally settles, the increased UAE volumes will eventually hit a market where demand has shrunk because the war has changed the nature of energy consumption and reduced the oil intensity of economic growth – as the twin oil shocks in the 1970s did.

That might blow up the cartel, which would then have lost any material influence and outlived any usefulness.

The UAE’s decision comes at an important moment in the war, with Trump still trying to work out how to extricate the US from a stalemate he didn’t envisage when he launched the war.

Iran’s closure of the strait and the blow to global economic activity (and the politically sensitive US petrol and diesel prices) blindsided the Trump administration, even though that closure – for the first time ever – was predictable and, indeed, predicted.

When and how the strait reopens, and how much Iran will continue to control the crucial route, will be critical for the UAE, its Middle Eastern neighbours, the oil market and the global economy. The status of the strait will also determine how and when the increased UAE oil volumes can enter the market.

The Market Recap

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