00:00Just a day after the United Arab Emirates announced its exit from OPEC and OPEC+,
00:05global oil markets face a moment of uncertainty.
00:09With the trade-off or most still disrupted amid the Iran conflict,
00:12Hussein Bahri-Kert from the Center for Middle Eastern Studies says
00:17the timing is not coincidental and could signal a shift
00:21in how major producers approach output and pricing power.
00:26I just want to state that it's not a decision made overnight.
00:32So the UAE has been challenging for quota of the OPEC for years.
00:38So it was always a matter of timing rather than intention.
00:43And they were intending to leave OPEC for a long time.
00:48But now, for now, because of the pressures created by war
00:54and the much more lesser political costs, they decided to leave OPEC.
01:01So probably we will see more oil production from UAE side
01:08because they have been investing much for oil production capacity.
01:14Of course, it will weaken the role of OPEC for oil prices globally.
01:21So for now, because of the trade of Hermos is blocked,
01:26market reaction was limited.
01:28But once we will settle down, we will see real impact on market.
01:34Hussein also explains how the strain between the UAE and Saudi Arabia
01:39led to the decision.
01:41OPEC was mostly dominated by Saudi Arabia.
01:47But UAE is trying to produce more.
01:51And of course, this trade of Hermos blockade diversifies their revenues as well.
02:01Like because even though Saudi Arabia is producing much more less
02:06when you compare it with the last year,
02:09due to high oil prices and their capacity,
02:14their ability to pump gas oil from straight to the Red Sea,
02:23they have much more revenue than UAE.
02:29So in that sense, like UAE has the disadvantages.
02:34So they are trying to change this.
02:38Looking ahead, Hussein says the UAE's exit could have wider implications for the group.
02:44But for now, market reaction remains muted,
02:47largely due to the ongoing blockage of the Strait of Hermos.
02:50For longer term, it might affect other members of the OPEC as well.
02:57Because we know that Iraq and Kazakhstan has their reservations for quotas as well.
03:03So for midterm or longer term,
03:06we can see that other members might try to leave OPEC as well.
03:13Then we will have like a much, much more bigger impact.
03:18But for shorter term, as I said,
03:22until Strait of Hermos will reopen again,
03:27the reaction will be limited.
03:29After that, of course,
03:32like we will have
03:35like decrease in oil prices.
03:38Thanks.
03:38Thanks.
03:39Thanks.
03:40Thanks.
03:40Thanks.
03:40You
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