Behind the OPEC impasse, one oil country looks to a non-oil future

[ad_1]

Behind the standoff within OPEC over whether to increase oil production, a key member of the cartel has a new strategy: sell as much crude as possible before demand dries up.

The UAE strategy, as described by well-informed officials, represents one of the most significant shifts in oil policy by a major Middle Eastern oil state. For years, oil-producing governments in the region have said they are not worried about finding buyers for oil in the distant future. The United Arab Emirates, which holds some of the largest untapped crude oil reserves in the world, is breaking this orthodoxy, according to people familiar with the strategy.

“This is the time to maximize the value of the country’s hydrocarbon resources, while they have value,” said a person familiar with the UAE’s strategy. “The goal of the investment is to generate revenue to diversify the economy, both to invest in new energy, as well as in new revenue streams, which is the most important thing.”

The country is not worried about the sudden drop in demand, and expects to have buyers for its crude for decades. However, people familiar with the new path say the country wants to pump and sell as much as it can now, when demand and prices are strong. The proceeds will help wean its economy off oil.

“Market share is a major factor here,” said a senior Emirati oil official. “We want a bigger market share, to monetize as much as possible from our reserves, especially when we spend billions on developing them.”

.

[ad_2]