The UAE’s decision, which took effect May 1, followed years of dissatisfaction in Abu Dhabi with production quotas that limited output despite the country’s significant investment in capacity expansion.
Tensions are growing within OPEC and the OPEC+ format, with production discipline increasingly at odds with the plans of countries seeking to maximize their market share.
Beyond production issues, the move reflects a more independent approach.
Pressure on OPEC
While the UAE’s withdrawal does not mean the end of OPEC, it adds pressure to an already strained system.
“This decision was not unexpected,” Euronews quoted analyst Andrei Covatariu as saying, recalling that the UAE has repeatedly expressed dissatisfaction with production limits and has been pushing for more flexibility.
He also emphasized that the move raises a more general question: whether OPEC’s traditional quota system remains effective, especially for producers with spare capacity who are seeking to increase production.
“The commercial logic of agreeing to production limits is becoming less and less compelling,” he added, “as producers try to monetize resources while demand and prices remain high.
Coordination in the Gulf States
This could lead to a deepening crisis within OPEC, which is not yet evident. Saudi Arabia and Russia are likely to remain the dominant players in OPEC+, although the group’s overall weight is diminishing.
In the Gulf states, the move has highlighted deep divisions that emerged long before the current crisis.
Covatariu recalled that the UAE’s withdrawal followed Qatar’s exit from OPEC in 2019, indicating that Gulf states are increasingly prioritizing national strategies over collective mechanisms.
Analysts do not expect a sharp conflict, but a cautious reaction from regional players with a focus on maintaining stability in the bloc.
