Oil Reverses Slide After Reuters, Bloomberg Say WSJ Report Of UAE Leaving OPEC Is "Far From Truth"
Update (950am ET): Earlier, when we presented the latest iteration of the annually recurring (and annually wrong) WSJ report that the UAE was "discussing" leaving OPEC, we asked how long until we got a denial, and as noted below, we put the over/under at 90/120 minutes.
How long until UAE denies https://t.co/BSpw88EFwT— zerohedge (@zerohedge) March 3, 2023
The answer: under... at just 48 minutes, with first Reuters dunking on the WSJ...
- MEDIA REPORT ON UAE CONSIDERING LEAVING OPEC IS "FAR FROM THE TRUTH" - RTRS SOURCE WITH DIRECT KNOWLEDGE OF THE MATTER
... and then Bloomberg too:
- *UAE OFFICIALS SAY PRIVATELY NO PLANS TO LEAVE OPEC
48 minutes— zerohedge (@zerohedge) March 3, 2023
MEDIA REPORT ON UAE CONSIDERING LEAVING OPEC IS "FAR FROM THE TRUTH" - RTRS SOURCE WITH DIRECT KNOWLEDGE OF THE MATTER https://t.co/D0tod6eXAF
OIl immediately reversed all earlier losses sustained by the increasingly wrong reporting by a WSJ energy team whose credibility and objectivity has become very much suspect.
* * *
Following recent snubs, The Wall Street Journal reports a growing rift between two of OPEC's largest producers - Saudi Arabia and the United Arab Emirates.
Still formally allies, Saudi Arabia and the U.A.E. have diverged on several fronts, competing for foreign investment and influence in global oil markets and clashing on the direction of the Yemen war.
The disagreements once unfolded behind closed doors but are increasingly spilling out into the open, threatening to reorder alliances in the energy-rich Persian Gulf at a time when Iran is trying to exert more sway across the region and Russia's war in Ukraine has raised crude prices and roiled OPEC decision-making.
Crude prices tumbled on the news as fears of a crack in OPEC's production promises may lead to more supply...
Crucially, within OPEC, the U.A.E. is obligated to pump much less than it is capable of, hurting its oil revenue.
It has long pushed to pump more oil, but the Saudis have said no, OPEC delegates have said.
Now, some Emirati officials say, the U.A.E. is having an internal debate about leaving OPEC, a decision that would shake the cartel and undermine its power in global oil markets.
And most recently, the Emiratis clashed with the Saudis last October when OPEC+ decided to dramatically reduce oil production to prop up crude prices.
"Up until a few years ago, this sort of division and openly pursuing objectives that are counter to what their brothers are pursuing was unheard of," said Dina Esfandiary, senior adviser for the Middle East and North Africa at the International Crisis Group.
"Now it's becoming increasingly normal."
The Emiratis are "worried about a Saudi that works against their interests," said Ms. Esfandiary. She said the Saudis are concerned the U.A.E. poses a threat to Saudi dominance in the Gulf.
As a reminder, this is not all that unusual, as UAE seems to want to rattle their oil sabre every few years...
O/U on the UAE denial is 90/120 mins.