United Arab Emirates to leave OPEC on May 1

April 28 (UPI) -- The United Arab Emirates announced Tuesday that it would leave the Organization of the Petroleum Exporting Countries on May 1.

The UAE has said in the past that it considered leaving OPEC because quotas had slowed its oil exports.

But attacks on the Emirates from fellow OPEC member Iran and the constraint of a closed Strait of Hormuz have threatened the UAE's economy.

Its government decided to leave after 50 years because of its "long-term strategy and economic vision," and because it plans to boost investment in domestic energy production, the country said in a statement published by WAM, the Emirati state news agency.

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OPEC was established in 1960 as a counter to the United States, the largest oil producer at the time. It was founded by representatives from Iran, Iraq, Kuwait, Saudi Arabia and Venezuela, after American oil companies lowered the price it would pay for oil from those nations. The organization's power has slipped in recent years as American oil production has soared.

Abu Dhabi joined OPEC in 1967, and the UAE joined when it formed in 1971.

The UAE will likely increase production. Before the war, the UAE was producing about 12% of OPEC's production. OPEC's 12 members supplied more than 25% of the world's oil.

"The UAE reaffirmed that its production policies will be guided by responsibility and market stability, taking into account global supply and demand," the country's statement said. "It will continue investing across the energy value chain, including oil, gas, renewables and low-carbon solutions, to support resilience and long-term energy system transformation. The UAE values more than five decades of cooperation with partners and will continue active engagement in support of stable global energy markets."

Oil prices have spiked more than 40% since the beginning of the war on Iran in late February.

In an interview with the New York Times, UAE Energy Minister Suhail Al Mazrouei said the country wants to leave the constraints imposed by OPEC.

"The world needs more energy. The world needs more resources, and UAE wanted to be unconstrained by any groups," Al Mazrouei told The Times.

The timing was right, he told CNBC.

"Our exit at this time is the right time for it because it will have a minimum impact on the price and it will have a minimum impact on our friends at OPEC and OPEC+," Al Mazrouei said.

"The decision reflects a policy-driven evolution in the UAE's approach, enhancing flexibility to respond to market dynamics while continuing to contribute to stability in a measured and responsible manner," the statement said.

Tensions between the UAE and Saudi Arabia, OPEC's de facto leader, have risen in recent years.

The Emirates have courted closer ties to Israel and backed a separatist group in Yemen. The Saudis support the Yemeni government.

"This has nothing to do with any of our brothers or friends within the group," Al Mazrouei told CNBC. "We've been working together for years and years. We have the highest respect for the Saudis for leading OPEC."

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Britain's King Charles III delivers an address to a joint meeting of Congress at the U.S. Capitol on Tuesday. The king and Queen Camilla are on a four-day state visit to the U.S. with stops in Washington and New York. Photo by Bonnie Cash/UPI | License Photo