Opec

• OPEC+ announced fresh oil production increase for June 2026, with seven key members—Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman—collectively raising output by 188,000 barrels per day. • The move follows UAE's exit from the bloc and represents a gradual rollback of voluntary production cuts first introduced in 2023, with officials emphasizing flexibility to adjust output based on market conditions. • This supply boost decision comes amid volatile global crude prices and could directly impact fuel costs and inflation worldwide, particularly affecting energy-dependent economies like India.

• The United Arab Emirates withdrew from OPEC yesterday, marking a historic split from Saudi Arabia during the escalating regional crisis. • This decision coincides with the Strait of Hormuz being almost entirely shut down due to a US naval blockade aimed at halting Iranian oil exports. • The US is threatening to cut off major Chinese banks from its financial system to prevent processing of Iranian oil, intensifying global energy tensions.

Defection is damaging to Saudi Arabia’s prestige – and could strengthen the US hand in the regionThe United Arab Emirates’ decision to walk out of Opec is a political as much as business decision, and will reignite the simmering rows between the UAE and Saudi Arabia – which had been covered up by their shared anger with Iran over its attacks on the Gulf states since the start of the US-Israel war on Tehran.In the short term, leaving the oil producing cartel it joined in 1967 gives the UAE the freedom to respond quickly to a long-term prospect of constrained supplies, and to maximise profit. But it is a decision the UAE has considered before, as UAE and Saudi tensions over production quotas have been longstanding. Continue reading...