#UAE stock markets edge higher on rising oil prices, Fed rate cut hopes | Reuters

UAE stock markets edge higher on rising oil prices, Fed rate cut hopes | Reuters

Stock markets in the United Arab Emirates edged higher on Friday, buoyed by rising oil prices and growing expectations of a U.S. Federal Reserve rate cut next month.

While the Fed has maintained a cautious tone on further monetary easing amid a dearth of economic data caused by the prolonged U.S. government shutdown, several influential policymakers have signalled openness to additional cuts.

Recent comments from New York Fed President John Williams and Governor Christopher Waller, suggesting a December move may be warranted, have strengthened dovish market bets.

Dubai's benchmark index (.DFMGI), opens new tab rose 0.4% to 5,837, extending gains from the previous session, lifted by real estate and utilities stocks.

Blue-chip developer Emaar Properties (EMAR.DU), opens new tab added 0.8%, while its unit Emaar Development (EMAARDEV.DU), opens new tab advanced 2.1%. Dubai Electricity and Water Authority (DEWAA.DU), opens new tab, the state-owned utility, climbed 1.9%.

Abu Dhabi's benchmark index (.FTFADGI), opens new tab gained 0.4% to 9,747, snapping a five-session losing streak. First Abu Dhabi Bank (FAB.AD), opens new tab edged up 0.1%, while Abu Dhabi Commercial Bank (ADCB.AD), opens new tab jumped 4.8%, marking its sharpest intraday gain in over two months.

For November, Dubai's index fell 3.7%, its steepest monthly decline this year after March, while Abu Dhabi's benchmark shed 3.5%, according to LSEG data.

OPEC+ Needs to Clean Up Its Own Oil Numbers - Bloomberg

OPEC+ Needs to Clean Up Its Own Oil Numbers - Bloomberg

 On the eve of a contentious OPEC meeting in the 1980s, one of the cartel’s top officials penned a poem that caused quite a stir among his colleagues. As the group meets on Sunday facing the danger of an oil price crash in 2026, his verses remain as relevant and as controversial four decades later.

“If you seek to retain stable prices
It will entail some great sacrifices
Lower further your production ceiling
And ban error and violation.”

The furor provoked by Sheik Mana al-Otaiba, then oil minister of the United Arab Emirates by day and published poet by night1, wasn’t about the need to cut output. Rather, it was about his reference to “error and violation” — poetic license for the lies and cheating that plagued the group.
Pity, OPEC doesn’t have an in-house bard anymore; still, its members engage in the same deception. For several quarters, rather than face the problem, the cartel has obfuscated. If it has any hope of regaining control of the market’s narrative — let alone of the market itself — it needs to clean up its act. Fortunately, there are signs inside the group it’s now recognizing the urgency of the problem.
OPEC+, as the group is known after it formed a loose coalition with Russia, Kazakhstan and several others, typically acts when it feels the heat. And, oh boy, it’s hot: On a monthly average basis, Brent will end November at $63.50 a barrel, the lowest month in four and a half years. Further falls are likely in 2026, particularly if Ukraine and Russia seal a peace deal
While OPEC+ may need to cut production next year, it first needs to restore its own credibility.
The first step is about how much each of its members pump. Never in recent history has the oil market has been skeptical of self-reported production levels. Doubts are also rife about the estimates compiled by a group of independent data providers called the “OPEC secondary sources,” which are also published monthly by the cartel. The data providers came under huge pressure from Saudi Arabia earlier this year to change their methodology, which briefly showed that Riyadh was pumping more than it was.
Likewise, the UAE officially pumps 3.3 million barrels a day; trust what traders and independent tanker trackers say, and it’s closer to — if not higher than — 4 million.
The problem is exacerbated by a quirk of how OPEC measures output. The group doesn’t count total oil production of its members, but a smaller segment of what’s technically called crude. Other liquids from oil wells, called condensates and natural gas liquids, are typically excluded. Unsurprisingly, OPEC nations have invested billions to use the loophole to bypass official production limits. Last year, OPEC+ pumped 40.9 million barrels of crude, which was subjected to quotas, plus another 8.5 million barrels a day of other liquids, which weren’t under any limits.
For next year, OPEC+ anticipates that its outside-the-quotas output will increase by 200,000 barrels a day to 8.8 million, further stressing an oversupplied market. And the trend will likely continue, as the Saudis and UAE prioritize non-crude oil liquids production.
The second step is to align actual production with quotas. OPEC+ nations typically cheat on their limits. Kazakhstan is a notorious violator, having pumped above its assigned level for all of 2025. Iraq and the United Arab Emirates are on it, too; so is Kuwait and even tiny Gabon.
To solve the cheating problem, OPEC has created another obfuscation mechanism, which it calls “compensation.” OPEC nations that overproduce are told to compensate for their misbehavior later, reducing production temporarily. Unsurprisingly, the compensation mechanism has become a parody of itself, with countries not only cheating on their quotas, but on their compensation promises too, triggering even further compensations, which trigger even more compensation-dodging.
What should OPEC do? First, start publishing accurate data that includes not only crude but other liquids. Better to acknowledge past “error,” even if that entails confessing that the group misled the market in the pas. Then, its members should adhere to whatever output level is agreed with a set of realistic production quotas.
The Sunday meeting will probably involve discussion of an output audit, which has been on the table since 2023. The latest efforts put a new audit in 2027 — too late to manage the impending surplus. That’s why there’s debate behind closed doors about fast-tracking the audit to 2026, if possible, by the first half or even the first quarter. There are, of course, complications beyond scheduling: Some members, notably Russia, Venezuela and Iran, object to the involvement of US companies because they are themselves under American sanctions.
Ideally, the quotas should cover every member, rather than a subset of nations. Currently, OPEC+ has a hodgepodge of production targets. The key one covers only eight nations. Another covers a few more countries. And Libya, Venezuela and Iran are largely excluded of targets. Rather than having multiple layers, OPEC+ should revert to what it did only five years ago, with a single layer.
The clock is ticking. Oil prices are melting down. For now, OPEC+ may wait to seek clarity about a Russia-Ukraine peace deal and the US gunboat diplomacy toward Venezuela. But its next move, perhaps when West Texas Intermediate crude approaches $50 a barrel, is likely an output cut. Back in the 1980s, Sheik al-Otaiba saw what was inevitably coming and what was needed, and put his oil thoughts into another poem:

“The price of oil is failing down
Reduction does now look inevitable.
So let us discuss clear quotas
Though discussions may seem impossible,
the least of evils seems the best,
Thus choice rest with what is acceptable.”

1. Sheik Al-Otaiba has published dozens of poems in Arabic and English. His poems about OPEC and the oil market were compiled in "Poems on Petroleum," published in 1986 by Darl al Fajr of Abu Dhabi. He called the collection "the divide between the profession of petroleum and the pastime of poetry."

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