The price of oil crashed on Wednesday after the UAE reportedly said it would encourage fellow OPEC members to increase oil production levels.
“We favor production increases and will be encouraging OPEC to consider higher production levels,” said Yousef al-Otaiba, the UAE’s ambassador to Washington. This statement was first reported by the Financial Times.
“The UAE has been a reliable and responsible supplier of energy to global markets for more than 50 years and believes that stability in energy markets is critical to the global economy,” he continued.
West Texas Intermediate crude futures, the U.S. benchmark, were down by more than 10 percent at 1 P.M. eastern standard time. Brent crude was down by 10.9 percent.
OPEC and related oil producers have resisted pleas from the Biden administration to increase production as oil prices rose. The Biden administration began calling for more oil from abroad last year, months before the Russian attack on Ukraine. Leaders in Saudi Arabia and the UAE reportedly refused to take calls from Biden recently.
It is not clear if UAE has consulted with the Saudis or other OPEC members about this apparent change of heart.