The UAE is reducing oil production: what are the reasons?
8 March 15:11
The United Arab Emirates has begun to cut oil production, as the closure significantly limits export opportunities.
This was reported by "Komersant Ukrainian" with reference to Bloomberg.
It is noted that Abu Dhabi’s national oil company “manages offshore production levels to meet storage needs.”
The UAE, which produced more than 3.5 million barrels per day in January and was OPEC’s third-largest producer, is using export capacity bypassing the Strait of Hormuz and its international storage facilities to ensure supplies to world markets.
The country operates a 1.5 million barrel per day pipeline to Fujairah on the UAE’s west coast to avoid restrictions in the strait. Adnoc said its onshore export operations are continuing as normal.
Saudi Arabia, the region’s largest oil exporter, has also previously diverted some of its crude oil from this route to Yanbu on the Red Sea.
Markets react to US-Iran conflict
It should be noted that global oil prices recently reached a record high amid production cuts and geopolitical instability.
Major producers in the Middle East will maintain oil production for a maximum of 25 days if traffic through the Strait of Hormuz is completely halted.
Regional leaders are already responding to the situation—India and Iran have raised prices for their own raw materials, which creates the conditions for further increases in energy prices worldwide.
It should be noted that today, March 8, it became known that Kuwait declared force majeure amid the conflict between the United States and Iran and began to reduce oil production in the country.
