UAE Exit Weaksens OPEC+ Power Over Oil Market
The United Arab Emirates (UAE) is set to leave OPEC+ on May 1, marking its departure after nearly 60 years as a member. As the fourth-largest producer in the Organization of the Petroleum Exporting Countries, the UAE's exit will weaken OPEC+'s power over the oil market.
The move comes amid growing tension between the UAE and Saudi Arabia, with Abu Dhabi seeking a bigger production quota to reflect its expanded capacity. The UAE has pumped around 3.4 million barrels per day (bpd) or about 3% of the world's crude supply before the U.S.-Israeli war on Iran forced it and other Middle East Gulf producers to curb shipments and shut down some production.
OPEC+ members will likely focus on rebuilding facilities hit by the war rather than embarking on production cuts in the near future, according to Helima Croft from RBC Capital Markets. The UAE's exit means OPEC+'s control over global oil production will decline to around 45%, down from 50% in 2025.