Subject: Re: UAE to leave OPEC

“Outside the group, the UAE would have both the incentive and the ability to increase production, raising broader questions about the sustainability of Saudi Arabia’s role as the market’s central stabiliser – and pointing to a potentially more volatile oil market as Opec’s capacity to smooth supply imbalances diminishes.”

According to the net sifter, the UAE has been exporting about 3Mbpd. With the Strait obstructed, they can only push about 1.8Mbpd through their pipeline to the Gulf of Oman. Would be interesting to see if they try an arty deal with Iran for safe passage of their cargoes. But, if they deal with Iran, then the US would interdict their cargoes.

Historically, whenever anyone tried to bolt OPEC, Saudi would open the taps wide, and crash prices until the rebel got back in line.

Steve