The Saudi-Emirati rift within OPEC is a sign of things to come

IT IS RAREUAEOPECUAEOPECOPECOPEC for spats about oil supply to break out between Saudi Arabia and the United Arab Emirates (). The countries’ views on output usually align. Traders and analysts regard them, along with Kuwait, as the core of the Organisation of the Petroleum Exporting Countries (). So eyebrows were raised in early July when Suhail Al Mazrouei, the ’s energy minister, told reporters that ’s quotas were “totally unfair”. A further surprise came on July 5th when meetings between the cartel and its allies (notably Russia), together known as +, were abandoned because of the row. The price of the benchmark Brent crude rose above $77 a barrel for the first time in more than two years, before dropping back below $75; that of American crude briefly hit a six-year high.+ introduced swingeing production cuts last spring as covid-19 began to spread, the demand for fuel tanked and the oil price collapsed to below $30 per barrel. More recently the cartel has been carefully increasing supply as demand has revived and oil prices have recovered. The cancelled meeting had been convened with the goal of agreeing on further increases to output after July. At the same time the Saudis and others were also seeking to extend the current regime for assigning cuts to members’ production.