The United Arab Emirates (UAE) is important to world energy markets because it contains 98 billion barrels, or nearly 10 percent, of the world's proven oil reserves. The UAE also holds the world's fifth-largest natural gas reserves and exports significant amounts of liquefied natural gas.

Climate :

The climate is hot and dry. The mean January temperature is 18°C (65°F.) and the mean temperature in July is 33°C (92°F). The average annual rainfall is 152mm (6in). The major natural resource is petroleum.

Temperatures from May to September are frequently in the low 40s C with high humidity common in Abu Dhabi and Dubai. In the cities of Fujairah and Khor Fakkan the climate is more pleasant and also in the mountains above Ras al-Khaimah. During the winter, the entire country generally experiences very good weather though it is often quite windy. Cold weather is not unknown and in the desert around Al-Ain, temperatures sometimes drop as low as 10°C. Winter in the inland desert is usually pleasantly brisk.

Peoples :
As a result of the oil boom, less than 50% of the inhabitants of the UAE are Arabs. There are large groups of Indians, Pakistanis, Iranians and Southeast Asians. The population is, however, 95% Muslim. The capital is Abu Dhabi and the second most important city is Dubai. In the UAE, six years of primary education is free and compulsory. Because of the income from petroleum, health services and social services are provided virtually free. The people of the UAE are Arab, descended from the tribal confederations dominating the peninsula since before recorded history. Arabic is of course the official language but English is widely spoken and so are Urdu, Malayalam and Tagalog from the Philippines. All these groups add to the diversity of the UAE's cosmopolitan society.

Foreign Affairs :
The UAE and Iran continue to dispute the ownership of three islands, Abu Musa and the Greater and Lesser Tunb Islands, which are strategically located in the Strait of Hormuz. All three islands were effectively occupied by Iranian troops in 1992. The Mubarak field, which is located six miles off Abu Musa, has been producing oil and associated natural gas since 1974. In 1995, the Iranian Foreign Ministry claimed that the islands are "an inseparable part of Iran." Iran rejected a 1996 proposal by the Gulf Cooperation Council (GCC) for the dispute to be resolved by the International Court of Justice, an option supported by the UAE. In early 1996, Iran took further moves to strengthen its hold on the disputed islands. These actions included starting up a power plant on Greater Tunb, opening an airport on Abu Musa, and announcing plans for construction of a new port on Abu Musa. In the dispute, the UAE has received strong support from the GCC, the United Nations, and the United States. Although Iran remains a continuing concern for officials in Abu Dhabi, they have chosen not to escalate the territorial dispute. Iran is one of Dubai’s major trading partners, accounting for 20 percent to 30 percent of Dubai’s business.

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