Following its recent announcement, the United Arab Emirates is set to leave the Organization of the Petroleum Exporting Countries (OPEC) as of May 1, marking a notable shift within the group, which currently consists of 12 oil-producing countries, including Saudi Arabia, Iraq, Iran and Kuwait. The move comes at a time when regional trade flows remain disrupted by ongoing geopolitical tensions, while global oil markets continue to face limited visibility due to logistical constraints. Within this context, market sources indicate that the UAE’s decision reflects a growing preference for a more flexible and independent production strategy, with the country aiming to increase its output capacity and operate outside the group’s quota system.
While no immediate impact on oil prices has been clearly observed so far, as restricted trade flows continue to shape market conditions, the development is expected to influence market dynamics in the period ahead. In particular, the potential for additional supply in the medium term may start to weigh on energy prices once current disruptions ease and trade flows normalize. This, in turn, could create some room for easing production costs, suggesting a possible indirect impact on the steel market, though no clear effect has been observed at this stage.
“At this stage, we do not expect an immediate impact, but, over time, oil prices could come under pressure, as the UAE has the ability to increase supply by around 20-25 percent,” a market source told SteelOrbis.
