The United Arab Emirates’ (UAE) Ambassador to the United States has indicated in a statement to the Financial Times that his country is willing to increase production and persuade other OPEC members to do the same.
In the statement, Yousef al-Otaiba said:
“We favour production increases and will be encouraging OPEC to consider higher production levels. The UAE has been a reliable and responsible supplier of energy to global markets for more than 50 years and believes that stability in energy markets is critical to the global economy.”
The OPEC+ group are currently following a gradual plan to increase production by 400,000 barrels per day (bpd), and the comments mark the first time a prominent official of an OPEC member country has called for greater crude oil production since Russia’s invasion of Ukraine. Brent Crude had been trading over $130 per barrel, and high oil prices feed not just into fuel prices, but also potentially derived products like Mobil hydraulic oil and Nynas transformer oil.
Following the ambassador’s comments, the price declined to around $110. There was some confusion, however, when the Energy Minister of the UAE, Suhail Al Mazrouei, tweeted that the country was still committed to the planned gradual increases in production.
The UAE is a close ally of Saudi Arabia, which is thought to have substantial spare capacity, although OPEC Secretary-General Mohammed Barkindo warned recently that the capacity to replace seven million bpd of Russian oil simply did not exist in the world right now.