It’s possible that I shall make an ass of myself. But in that case one can always get out of it with a little dialectic. I have, of course, so worded my proposition as to be right either way (K.Marx, Letter to F.Engels on the Indian Mutiny)
Tuesday, April 28, 2026
UAE Exits OPEC, Casting Shadow Over the Oil Cartel's Future
The United Arab Emirates has announced a decision to leave the Organization of Petroleum Exporting Countries (OPEC), a major blow to the supply cartel that has exerted influence over global oil prices since 1960.
"The UAE’s decision to exit from OPEC reflects a policy-driven evolution aligned with long-term market fundamentals," said UAE energy minister Suhail Mohamed Al Mazrouei in a statement. "We thank OPEC and its member countries for decades of constructive cooperation. We remain committed to energy security, providing reliable, responsible, and lower-carbon supply while supporting stable global markets."
The UAE has been a member of OPEC for nearly 60 years, and is one of its most important swing producers. Like Saudi oilfields, the UAE's wells can vary their production rates without suffering long-term damage, giving national oil company ADNOC the ability to increase or decrease output as desired to affect global supply levels - and influence global prices. But in recent years, Emirati leaders have chafed at the restrictions that OPEC places on their ability to make sovereign decisions about export sales, and tensions have been brewing for some time. While the announcement of the country's exit was sudden, it was not unexpected.
"The country wants to increase output capacity and actually use it, rather than keep production capped, especially after the war ends and Hormuz [opens]," commented UAE-based Middle East energy analyst Amena Bakr, a senior researcher at Kpler. "The UAE is positioning itself as a more flexible, market-responsive producer and wants to tap into the capacity it’s invested in without constraints."
The move may strengthen the UAE's earning potential, and give it more flexibility to invest in pipeline capacity to loading ports on the Gulf of Oman - a desperately-needed backup, since Iran has demonstrated an ability to close the Strait of Hormuz to Emirati tanker traffic. ADNOC maintains a pipeline to Fujairah for export of its regional benchmark Dubai grade, but it is not large enough to accommodate full-rate production; this has forced the UAE to curtail output by shutting in wells, an undesirable choice that will take months to reverse when the conflict ends.
For OPEC, the UAE's exit is a blow, warns Bakr. For now it will have little market effect, as much of OPEC's output is already trapped west of Hormuz and there is little prospect of increasing supply in the near term. But the Emirates were the third-largest producer in the bloc, and their swing capacity made them an influential member. "It shakes group cohesion and makes everyone wonder who will leave next," Bakr said in a social media post. "Is this the end of market management?"
The United Arab Emirates has announced its withdrawal from OPEC and the broader OPEC+ alliance, effective May 1, 2026, stripping the cartel of one of its highest-capacity and lowest-cost producers.
According to Emirates News Agency (WAM), the decision stems from the UAE's long-term strategic and economic vision, including accelerating investment in domestic energy production. The country joined OPEC in 1967 through the Emirate of Abu Dhabi and continued its membership following the federation's establishment in 1971. Still, UAE Energy Minister Suhail Al Mazroui affirmed in a press statement that the decision was taken unilaterally, with no input from Saudi Arabia or other countries.
The UAE has increasingly chafed under OPEC+ production constraints in recent years, having secured a higher baseline quota in 2021 following a protracted dispute with Saudi Arabia. Abu Dhabi National Oil Company (ADNOC) has since pushed aggressively toward a production capacity target of 5mn barrels per day by 2027, a trajectory difficult to reconcile with the coordinated output cuts that have defined OPEC+ policy since 2022.
The Emirates News Agency (WAM) cited ongoing near-term geopolitical volatility in the Arabian Gulf and disruptions in the Strait of Hormuz as additional factors informing the timing, framing the withdrawal as a response to market need rather than a departure from cooperative principles. The UAE will continue gradually increasing production in line with demand and market conditions following its exit.
The departure raises immediate questions about cohesion within OPEC+, where Saudi Arabia has shouldered a disproportionate share of voluntary cuts. With the UAE now free to produce at will, pressure on other members to reassess their own quota commitments is likely to intensify ahead of the group's next ministerial meeting.
"The UAE withdrawal marks a significant shift for OPEC. Alongside Saudi Arabia, it is one of the few members with meaningful spare capacity, the mechanism through which the group exerts market influence," Rystad Energy analyst Jorge Leon told Reuters.
“While near-term effects may be muted given ongoing disruptions in the Strait of Hormuz, the longer-term implication is a structurally weaker OPEC. Outside the group, the UAE would have both the incentive and the ability to increase production, raising broader questions about the sustainability of Saudi Arabia’s role as the market’s central stabiliser, and pointing to a potentially more volatile oil market as OPEC’s capacity to smooth supply imbalances diminishes," Leon concluded.
United Arab Emirates says it will leave OPEC in a blow to the oil cartel
The logo of the Organization of the Petroleum Exporting Countries (OPEC) is seen outside of OPEC's headquarters in Vienna, Austria, March 3, 2022. (AP Photo/Lisa Leutner)
DUBAI, United Arab Emirates — The United Arab Emirates said Tuesday it will leave OPEC effective May 1, stripping the oil cartel of its third-largest producer and further weakening its leverage over global oil supplies and prices.
The UAE’s decision had been rumored as a possibility for some time, as it pushed back in recent years against OPEC production quotas it felt had been too low — meaning it wasn’t able to sell as much oil to the world as it had wanted.
“Having invested heavily in expanding energy production capacity in recent years, the bigger picture is that the UAE has been itching to pump more oil,” Capital Economics wrote in an analysis. “The ties binding OPEC members together have loosened,” it said, particularly after Qatar withdrew from the cartel in 2019.
Regional politics are also likely at play. The UAE has had increasingly frosty relations with Saudi Arabia, OPEC’s largest producer, over political and economic matters in the Mideast, even after both came under attack by fellow OPEC member Iran during the war.
No immediate impact likely for world oil markets
The UAE’s withdrawal from OPEC won’t necessarily have any immediate effects in markets. That’s because world oil supplies are sharply constrained by the war in Iran, which has closed off the Strait of Hormuz, a waterway through which one-fifth of global oil supplies — including much of the UAE’s — is transported. On Tuesday, Brent crude, the international benchmark, traded above US$111 a barrel, or more than 50 per cent above its prewar price.
OPEC accounts for roughly 40 per cent of the world’s oil output, but its market power had been waning in recent years as the United States ramped up production. While Saudi Arabia had been producing more than 10 million barrels of oil a day before the war, the U.S. pumps more than 13 million barrels a day.
U.S. President Donald Trump has been a steady critic of the cartel during his two terms in the White House.
The UAE, which joined OPEC through its emirate of Abu Dhabi in 1967, had been producing around 3.4 million barrels of crude a day just before the U.S.-Israeli war with Iran began on Feb. 28. Analysts say it has capacity to produce roughly 5 million barrels a day.
In its announcement on Tuesday, made via its state-run WAM news agency, the UAE said it also would leave the wider OPEC+ group, which Russia had led to try to stabilize oil prices.
“This decision reflects the UAE’s long-term strategic and economic vision and evolving energy profile, including accelerated investment in domestic energy production,” the UAE said, adding that it would bring “additional production to market in a gradual and measured manner, aligned with demand and market conditions.”
The UAE’s withdrawal removes one of OPEC’s few members with the ability to quickly increase production, said Jorge Leon, head of geopolitical analysis at Rystad Energy.
“A structurally weaker OPEC, with less spare capacity concentrated within the group, will find it increasingly difficult to calibrate supply and stabilize prices,” he said.
Saudi Arabia, UAE increasingly at odds
Saudi Arabia and the UAE increasingly have competed over economic issues and regional politics, particularly in the Red Sea area. The two countries had jointly fought against Yemen’s Iran-backed Houthi rebels in 2015. However, that coalition broke down into recriminations in late December, when Saudi Arabia bombed what it described as a weapons shipment bound for Yemeni separatists backed by the UAE.
As tensions rose in recent months, Saudi broadcasters long based in Dubai, the economic hub of the UAE, have pulled back to the kingdom.
“This exit of OPEC fits into the UAE need for flexibility with key energy consumers as well -- including a future relationship with China and a more competitive relationship with Saudi Arabia,” said Karen Young, a senior research scholar at Columbia University’s Center on Global Energy Policy.
While Saudi Arabia and OPEC had no immediate reaction, Emirati Energy Minister Suhail al-Mazrouei insisted his country’s decision did not stem from any dispute with its Gulf neighbor.
“We’ve been working together for years and years. We have the highest respect for the Saudis for leading OPEC,” al-Mazrouei told CNBC.
However, the UAE sent its foreign minister rather than its ruler to a Gulf Arab leaders’ meeting held Tuesday in Jeddah, Saudi Arabia, hosted by Saudi Crown Prince Mohammed bin Salman.
The UAE hosted the United Nations COP28 climate talks in 2023, a conference that ended for the first time with a pledge by nearly 200 countries to move away from planet-warming fossil fuels. But the UAE still plans to increase its production capacity in the coming years, even as it pursues more clean energy at home, a move decried by climate activists.
“The demand for power is going to go up and up and up,” U.S. Interior Secretary Doug Burgum told an Abu Dhabi oil conference in November. “Today’s the day to announce that there is no energy transition. There is only energy addition.”
He drew widespread applause from his Emirati hosts.
___
Jon Gambrell, The Associated Press
Associated Press writer David McHugh in Frankfurt, Germany, contributed to this report.
A general view of Isfahan Refinery, one of the largest refineries in Iran and is considered as the first refinery in the country in terms of diversity of petroleum products in Isfahan, Iran on November 08, 2023. The products of this refinery include liquefied gas, gasoline, gas oil, aviation fuel types, kerosene, solvents, crude oil and sulfur. (Photo by Fatemeh Bahrami/Anadolu via Getty Images)
LONDON - The United Arab Emirates, one of OPEC+’s largest producers, will leave the oil producers’ alliance on May 1, it said on Tuesday.
The Organization of the Petroleum Exporting Countries and allies, including Russia, are known collectively as OPEC+. Last year, the group produced nearly 50 per cent of the world’s oil and oil liquids, according to International Energy Agency estimates. The UAE is the fourth largest producer in OPEC+.
OPEC was founded in 1960 in Baghdad by Iraq, Iran, Kuwait, Venezuela and Saudi Arabia with the aims of coordinating petroleum policies and securing fair and stable prices. Today, it includes 12 countries, mainly from the Middle East. The UAE joined in 1967.
The UAE is the fourth producer to leave the group in recent years, and by far the biggest. Angola, which joined OPEC in 2007, quit the bloc at the start of 2024, citing disagreements over production levels. Ecuador quit OPEC in 2020 and Qatar in 2019.
The group produced over half of global crude in the 1970s, according to Reuters calculations, before the onset of non-OPEC supply sources such as the North Sea.
In later decades, OPEC’s share stood at between 30 per cent and 40 per cent but record output growth from rivals such as the United States has steadily eaten into that share.
OPEC in 2016 sought to regain influence by forming an alliance with 10 non-members, including Russia, which it called OPEC+.
As a result, its market share increased to around 51.15 million bpd, or nearly 50 per cent of global oil and oil liquids production, in 2025, according to the International Energy Agency. In March, a month into the Iran war, that share fell to about 44 per cent. U.S.-Iran war reduces UAE production
Before the start of the U.S.-Iran war at the end of February, the UAE was producing 3.3 million bpd and had capacity to be able to produce as much as 4.5-5.0 million bpd of crude and oil liquids.
Its importance in OPEC in the past was increased because, together with leading OPEC member Saudi Arabia, it had spare capacity that it could add to the market if required.
That has become academic since the unprecedented oil market disruption caused by the effective closure of the Strait of Hormuz since the Iran war.
Gulf OPEC+ crude oil production fell by nearly 8 million barrels per day in March versus February as Saudi Arabia, the UAE, Kuwait and Iraq cut output, according to OPEC.
The cuts were necessary because they were limited in how much they could export, although both have some ability to bypass the Strait of Hormuz.
Saudi Arabia has a 7 million bpd pipeline to the Red Sea while the UAE can export 1.5-1.8 million bpd through a pipeline to the port of Fujairah. OPEC and global oil prices
OPEC+ says it cuts and raises oil production to balance the markets.
Its critics say the group manipulates prices, which OPEC denies.
During the 1973 Arab-Israeli War, Arab members of OPEC imposed an embargo against the United States in retaliation for its decision to re-supply the Israeli military, as well as other countries that supported Israel. The embargo banned petroleum exports to those nations.
The oil embargo pressured an already strained U.S. economy that had grown dependent on imported oil. Oil prices jumped, causing high fuel costs for consumers and fuel shortages. The embargo also brought the United States and other countries to the brink of a global recession.
U.S. President Donald Trump has accused the organization of “ripping off the rest of the world” by inflating oil prices. Trump has also linked U.S. military support to the Gulf with oil prices, saying that while the U.S. defends OPEC members, they “exploit this by imposing high oil prices.”
However, it was Trump who helped to convince OPEC+ to cut output in 2020 during the COVID pandemic as crude oil prices slumped and U.S. oil producers suffered.
In 2025, OPEC crude exports accounted for about 47 per cent of global crude seaborne exports, according to Kpler. In March, that share shrunk to 34.7 per cent, Kpler data show. Which countries are OPEC members?
The current members of OPEC are: Saudi Arabia, United Arab Emirates, Kuwait, Iraq, Iran, Algeria, Libya, Nigeria, Congo, Equatorial Guinea, Gabon and Venezuela. The UAE said it would leave the group on May 1.
Non-OPEC countries in the global alliance of OPEC+ are represented by Russia, Azerbaijan, Kazakhstan, Bahrain, Brunei, Malaysia, Mexico, Oman, South Sudan, Sudan and Brazil, which joined in early 2025.
Sources: Reuters News, World Economic Forum website, OPEC website, U.S. Department of State website, the International Energy Agency.
Reporting by Ahmad Ghaddar and Yousef Saba; Editing by Barbara Lewis.
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