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EXPERT COMMENT

The organization may have smoothed over the cracks this time. But the UAE’s very public dissent may be just the first sign of things to come.

It was little surprise that Saudi Arabia and the UAE eventually reached a compromise on OPEC production and baselines, despite the high drama at the latest OPEC ministerial. What was surprising, though, was the public nature of the disagreement and the willingness of UAE officials to joust so vigorously with their Saudi counterparts in international media, leading to energy minister Prince Abdulaziz bin Salman playing much more ‘a la guerre’ than ‘a plaisance’.

OPEC has had its fair share of drama over the years. Nevertheless, the fact that the two erstwhile allies who have worked closely on finessing the cartel’s policies for decades and, since 2015, co-ordinated on a range of regional policies – Egypt, Yemen, Jordan and, until recently, Iran – would air their dirty laundry in public, gives pause for thought.

A great deal of analysis so far has focused on the strident positions adopted by Abu Dhabi and Riyadh, but little attention has been given to OPEC itself and the organization’s ability to weather such storms.

This is not another article ringing the death knell of OPEC. However, it does call into question OPEC’s capacity to manage differences amongst its membership – which has grown from 13 to 24 as OPEC+ – and its ability to navigate choppy waters ahead as the oil industry sails towards the horizon.

Click here to continue reading the full version of this Expert Comment on the Chatham House website.