Posted originally on CTH on April 28, 2026 | Sundance

The United Arab Emirates (UAE) has announced they are leaving OPEC in order to manifest their own sovereign economic destiny and increase domestic oil production without the limits and rules of the OPEC cartel. This is a significant alignment with President Donald Trump who has actively argued against the OPEC assembly and the oil price controls they have historically imposed.

DUBAI, United Arab Emirates (AP) — The United Arab Emirates said Tuesday it will leave OPEC effective May 1, stripping the oil cartel of one of its largest producers and further weakening its leverage over global oil supplies and prices.

The UAE’s decision had been rumored as a possibility for some time, as it pushed back in recent years against OPEC production quotas it felt had been too low — meaning it wasn’t able to sell as much oil to the world as it had wanted.

“Having invested heavily in expanding energy production capacity in recent years, the bigger picture is that the UAE has been itching to pump more oil,” Capital Economics wrote in an analysis. “The ties binding OPEC members together have loosened,” it said, particularly after Qatar withdrew from the cartel in 2019. (read more)

As noted by CNBC, “The UAE has played an influential role in OPEC’s decisions over nearly six decades. It was the group’s third-largest oil producer in February behind Saudi Arabia and Iraq. The Gulf state joined OPEC in 1967, seven years after the organization was founded.”

This is where things get really interesting….  Because the UAE can effectively eliminate the Hormuz chokepoint, and Secretary of Treasury Scott Bessent previously outlined something very important to the UAE:

LAST WEEK:

WASHINGTON – US Treasury Secretary Scott Bessent said on Wednesday that a number of allies in the Gulf region and in  Asia have requested currency swap lines from the United States to help deal with energy shocks and other fallout from the Middle East war.

Bessent told US senators that both the US and the United Arab Emirates would benefit from a proposed swap line that President Donald Trump said he was considering on Tuesday.

Bessent did not name the countries making such requests, but told a US Senate Appropriations subcommittee budget hearing that such facilities would help stabilize financial markets amid turmoil from the Iran war.

“And swap lines, whether it’s from the Federal Reserve or the Treasury, are to maintain order in the dollar funding markets and to prevent the sale of the US assets in a disorderly way,” Bessent said. “So, the swap line would benefit both the UAE and the US, and as I said, numerous other countries, including some of our Asian allies, have also requested them.”

The US Treasury last October provided Argentina with a $20 billion currency swap to help stabilize the country’s peso during a tumultuous election period that helped strengthen the position of President Javier Milei’s party.

That swap line, backed by the Treasury’s $219 billion Exchange Stabilization Fund, provided Argentina with a safety net of dollars that the central bank could use to help prop up the value of the peso and prevent a devaluation ahead of the vote. It has since been repaid.

REQUESTS FOR RUSSIAN OIL

Bessent also said that he extended sanctions relief on Russian seaborne oil for another 30 days after requests from a number of countries that are most vulnerable to oil shortages from the closed Strait of Hormuz. The requests came during last week’s International Monetary Fund and World Bank spring meetings, he said.

The action reversed his comments last week that he would not renew expiring sanctions waivers. A separate waiver to allow countries to buy Iranian oil stranded at sea lapsed on April 19. (more)

The UAE can bypass the Hormuz chokepoint, and Saudi Arabia can pump oil to the Red Sea via their east/west pipeline.

If Trump keeps the blockade against Iranian oil shipments in place, the UAE and Saudi Arabia can fill the global oil void; however, they need to get outside the OPEC restrictions to do it.  Thus, the UAE exiting OPEC makes strategic sense both now and in the geopolitical longer term.

However, in the short run the UAE needs financial stability as the switch is done.  Enter Scott Bessent with the currency swap lines for the UAE.

Brilliant planning.

Iran just lost all their leverage.