TWTW Note

CWA # 2086
TWTW Note
UAE’s Exit from OPEC: 
Implications for the Middle East and the Energy Market

The timing of the exit during an ongoing major conflict reflects growing fragmentation within the Gulf.

Aishal Hab Yousuf
3 May 2026
Photo Source:

What happened?
On 28 April, the United Arab Emirates (UAE) officially notified its decision to exit from OPEC and OPEC+.

The UAE officials have framed the move as a strategic decision rather than a rupture of the existing status quo. Abu Dhabi insisted on the need for ‘flexibility’ in its production policy and for long-term economic diversification.

Energy Minister Suhail Al Mazrouei remarked that “The exit is tied to expanding production capacity and long-term economic goals”. Senior diplomat Anwar Gargash maintains that the UAE is pursuing “strategic autonomy.”

What is the background?
1. A brief note on the OPEC and OPEC+
Established in 1960, the Organisation of the Petroleum Exporting Countries (OPEC) is a coalition of major oil-producing countries that seeks to coordinate petroleum policies to stabilise global markets. Members have sought to collectively influence oil supply and, by extension, global prices. Over time, the organisation has been dominated by Gulf producers, especially Saudi Arabia. OPEC has served both economic and geopolitical interests. OPEC+ is an alliance formed in 2016 between OPEC and major non-OPEC producers, most notably Russia,  to coordinate oil production policies. Over the past decade, Qatar, Indonesia, Angola, and Ecuador have left OPEC, challenging its relevance and highlighting shifts in energy demand. The UAE’s exit from these groupings weakens its internal functioning, especially at a time of increased volatility in global energy. It signals a move towards autonomous energy strategies, undermining the concept of collective price-setting mechanisms.

2. Strains in Saudi Arabia–UAE relations
The UAE and Saudi Arabia have been on friendly terms in coordinating oil policy and in regional security. Both countries share similar models of governance and also common security concerns in their immediate neighbourhood. However, recent events indicate signs of differences. Saudi Arabia, under the Vision 2030 framework, has sought to reposition itself as the region's leading economic power, a move that clashes with the UAE’s role as a commercial hub. There have been disputes within OPEC over production baselines in previous years that exposed these underlying tensions. The UAE has asked for higher production quotas that reflect its expanded production; however, Saudi Arabia has prioritised market stability. In addition to these points of contention, Saudi Arabia and the UAE have divergent interests in Sudan and Yemen; both have tried arming and funding proxies to manipulate the outcomes in their favour. The UAE’s exit from OPEC also reflects these tensions. It is not a direct confrontation, but it depicts a form of emancipation from Saudi-led frameworks.

3. UAE’s frustration with Gulf responses to the Iran war
For the UAE, the other Gulf countries have not responded decisively to the ongoing US-Iran conflict. Reports indicate that Emirati policymakers are concerned about the implications for regional security and instability in the Strait of Hormuz. While Riyadh has proceeded with relative caution, the UAE’s stance has been focused on security. It has advocated for a stronger collective action to safeguard maritime routes and counter Iranian influence. The frustration is further compounded by economic concerns. The disruption of shipping lanes and oil flows has had a direct impact on the UAE’s trade-dependent economy. Abu Dhabi is increasingly unwilling to rely on multilateral institutions it considers ineffective or slow-moving.

What does it mean?
First, a turning point for Gulf energy politics. The UAE’s exit from OPEC is a significant benchmark in the evolution of Gulf energy governance. It reflects a broader trend towards decentralisation, in which individual states have prioritised their national interests in both the economy and security over collective goals and structures. While the likelihood of OPEC disintegrating is low, its ability to enforce its agenda over member states may come into question.

Second, implications for Saudi Arabian leadership. For Riyadh, the move represents a two-fold strategy, an opportunity and also a challenge. While it may reflect the limitations of its influence over the remaining OPEC countries, it may also allow Saudi Arabia to solidify its leadership. The long-term impact of the move on Saudi Arabia’s leadership is yet to be seen. Analysts and reports from Al Jazeera and Reuters have noted that Saudi Arabia is likely to retain its dominant spare capacity, which may allow it to steer production policy in the short term. Thus, the immediate economic impact on Riyadh is limited. OPEC+ partners like Moscow may find it difficult to navigate market volatility.

Third, regional fragmentation amidst crisis. The timing of the exit during an ongoing major conflict reflects growing fragmentation within the Gulf. The lack of a unified response to the war highlights diverging threat perceptions and policy priorities. 

Fourth, global energy market uncertainty. The UAE’s decision also adds to the uncertainty in global energy markets. With OPEC’s cohesion being questioned and geopolitical tensions being volatile, oil prices are likely to remain unpredictable. The International Energy Agency has already cautioned against prolonged instability, and the UAE’s latest move may accelerate a shift towards an unpredictable energy market.

About the author

Aishal Hab Yousuf is a postgraduate student at the Department of International Studies, Stella Maris College, Chennai. She is currently an intern at the National Institute of Advanced Studies (NIAS), Bengaluru.


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