The United Arab Emirates’ decision to quit the Organization of Petroleum Exporting Countries (OPEC) and OPEC+ effective May 1 has stunned the world: the UAE, long seen as one of the strong OPEC pillars, went a step further and has also quit OAPEC (Organization of Arab Petroleum Exporting Countries).

The OPEC, with its 13-member countries, later expanded in 2016 to form the OPEC+, which cooperated with Russia, Azerbaijan, Kazakhstan, Bahrain, Brunei, Malaysia, Mexico, Oman, South Sudan, and Sudan, bringing its output to about 41% of global supply. While OPEC focused on crude oil, OPEC+ included crude oil and lease condensate.

The UAE’s capacity, estimated at around 4.8 million barrels per day with significant room to increase output, said it was quitting because of “national interests”.

UAE Leaves the “Three Sisters”

The UAE, alongside Saudi Arabia, has been crucially important because its substantial spare capacity allows OPEC to respond to supply shocks.

However, the UAE’s assertive foreign policy approach was progressively isolating it from fellow OPEC members, especially Saudi Arabia, which was miffed by the UAE’s stand on Yemen and its opposition to OPEC’s imposition of output quotas. The UAE felt it was being restricted to produce roughly 3 million barrels a day despite having a capacity exceeding 4 million. Indeed, its state-owned Abu Dhabi National Oil Company (ADNOC) had been striving for a 5 million barrels a day target by 2027, planning to further increase it to 6 million barrels.

The UAE faced criticism from Saudi Arabia for allegedly supporting Yemen, after Saudi forces intercepted what they called an unauthorized UAE-linked weapons shipment headed for southern Yemen earlier this year. The UAE denied arming the separatists — but Saudi-UAE relations have not been the same ever since.

After announcing its withdrawal from OPEC and OPEC+, the UAE announced a few days later its intention to withdraw from the OAPEC; founded in 1968, OAPEC focuses on cooperation among Arab oil-exporting countries. The OAPEC general secretariat confirmed that the UAE Minister of Energy and Infrastructure, Suhail Mohammed Al-Mazrouei, had addressed a letter to Libya’s Oil and Gas Minister, Dr. Khalifa Rajab Abdul Sadiq, conveying the UAE’s decision to leave the organization on May 1, 2026.

UAE’s Energy Minister Al-Mazrouel explained that the decision to exit the cartel was taken after examining the country’s energy strategies and that the issue was not discussed with any other country, adding that the move was “… taken after a careful look at current and future policies related to levels of production”. At the “Make-it-in-The-Emirates” conference held some days back in Abu Dhabi, he emphasized that the UAE had departed from the cartel on “good terms” and would continue to work with members of the group.

The Hormuz Factor

Freed from its quota obligation imposed by OPEC, the UAE, however, is presently cautious about increasing its production because of the Hormuz Strait closure; it does not make economic sense for it to pump oil that cannot be shipped.

The withdrawal by the UAE, a founding member, is far more significant. As the Baker Institute for Public Policy at Rice University warned years ago, the UAE’s exit from OPEC would be the “most high-profile departure from the group … even overshadowing Qatar’s 2019 exit”.

While OPEC has survived several global uncertainties, such as the Iran-Iraq war, Venezuela’s collapse, and the 2020 Saudi-Russia price war, defections by founding members are an entirely different problem. The next OPEC+ meeting in June, without the UAE, will be closely watched.

The ongoing Hormuz crisis has created uncertainties in the region about the extent of future oil and gas revenue. While the UAE and Saudi Arabia do have pipelines to avoid the Hormuz Strait, other Gulf economies currently face a “dead-end situation”, to use a phrase in vogue.

Kuwait and Bahrain are losing monthly revenue of billions of dollars; indeed, Moody’s has already downgraded Bahrain’s credit outlook to “negative” from “stable”. Qatar also looks vulnerable to market upheavals since its production facilities and its export capabilities were hit by Iranian attacks.

The UAE ranks fourth among leading global oil suppliers, behind the U.S., Saudi Arabia, and Russia.

The UAE and ADNOC have partnered with several leading global energy companies. ExxonMobil, one of the major U.S. investors in the UAE, has assets in the UAE and Qatar, accounting for some 20% of its global production capacity, though this year’s first-quarter production sustained a 6% decline because of supply disruptions caused by the war. However, the UAE’s exit from OPEC could benefit Exxon, which will be free to increase production in support of ADNOC and other partners.

Occidental Petroleum, which also operates in the UAE, has a joint venture with ADNOC on Al Hosn Gas, one of the Middle East’s largest gas facilities, as well as at other sites in the UAE. Occidental should also benefit from the UAE's decision to leave OPEC, as it could open more investment opportunities in the country.

In short, the UAE's decision to leave OPEC would mean that the cartel would no longer control the UAE's output, enabling it to increase production as it sees fit. That could drive oil prices down in the future.

UAE’s Tight-Rope Act Between Washington and Riyadh

The UAE’s exit from OPEC also comes in the face of pressures it has faced over the years – production limitations constraining the UAE’s ambitions, a regional war that showed the limits of solidarity among the Gulf countries, and a deepening alignment with Washington and the latter’s financial architecture over which Riyadh has no control.

Although the UAE had a pre-conflict production capacity of 4.8 million barrels per day, the OPEC+ quotas allowed it to produce around 60 to 70% of that capacity. Indeed, the Iranian strikes and the Hormuz closure, which pushed the output to below 2 million barrels a day in March 2026, were the last straw for the UAE; the target set by ADNOC of reaching 5 million barrels a day by 2027 looked like a distant dream. With the Hormuz Strait closed, the UAE used the disruption period to build technical capacity, guided by the practical formula: plan now and pump once the Strait reopens.

The Trump administration, on its part, has viewed OPEC as a “price-fixing” cartel and has pushed for cheaper oil. The UAE’s exit could be interpreted as a candidate ready to embrace Washington’s objective and position itself as Washington’s cooperative energy partner. Indeed, the White House may even see the UAE as a more useful partner than Saudi Arabia.

The UAE’s leaning towards Washington goes beyond mere diplomatic alignment; it is also a move towards landing in the dollar system’s safety net, driven by capital flight risks and budget constraints caused by the Iran war and the Hormuz closure.

Will other members follow the UAE’s example and leave OPEC? The Domino effect of the UAE withdrawal cannot be ruled out since bilateral alignments with the US rather than with OPEC’s multilateral architecture could characterize the post-Hormuz energy order.