UAE Exit From OPEC Diminishes Group Influence and Raises Price War Risk

An analysis by Reuters columnist Ron Bousso, published by EnergyNow, indicates that the United Arab Emirates' decision to leave OPEC will substantially reduce the 65-year-old organisation's ability to steer crude markets. The piece outlines that the departure leaves the market vulnerable to price competition once Gulf exporters move to recover market share following the conclusion of current regional conflict.

The move arrives amid significant turbulence in energy supply, with Gulf oil and gas flows constrained for two months following the closure of the Strait of Hormuz. UAE Energy Minister Suhail Mohamed al-Mazrouei told Reuters that Abu Dhabi decided to withdraw to satisfy expanding global energy demand, though the analysis notes independence from output quotas provides room to ramp up volume.

Citing data from the International Energy Agency, the report notes that the UAE ranked as OPEC's fourth-largest producer in February—following Saudi Arabia, Iran, and Iraq—supplying roughly 12 percent of the group's total output. The UAE currently possesses production capacity of approximately 4.85 million barrels per day (bpd) and aims to reach 5 million bpd by 2027.

The analysis points out that low extraction costs and substantial reserves allow the UAE to remain profitable during downturns, diminishing its incentive to accept production caps. Although Qatar departed OPEC in 2019, Ecuador in 2020, and Angola in 2024, the report highlights that the scale of the UAE's production and spare capacity poses a far sharper challenge to future collective market management.