UAE announces intention to leave OPEC oil cartel

ABU DHABI

The United Arab Emirates has announced it will withdraw from both OPEC and the wider OPEC+ alliance as part of a strategic shift following the Iran war.

In a statement released on April 28, the Energy Ministry said the exit, set to take effect on May 1, would allow the country to better respond to evolving demand conditions.

It added that the UAE plans to gradually increase its oil output. The announcement came as OPEC members prepared for a meeting in Vienna on Wednesday.

According to the state news agency WAM, the move follows a comprehensive reassessment of the UAE’s production strategy, current capabilities and future capacity, and is guided by national interests as well as a commitment to addressing global market needs.

The statement also noted that while short-term volatility, including disruptions in the Persian Gulf and the Strait of Hormuz, continues to impact supply, broader trends indicate sustained growth in global energy demand over the medium to long term.

WAM described the decision as part of a policy evolution aimed at increasing flexibility in responding to market shifts, while maintaining a responsible role in supporting market stability.

The UAE’s departure deals a significant blow to OPEC and its de facto leader, Saudi Arabia, at a time when the Iran war has triggered a major energy shock and heightened economic uncertainty amid the uncertainty over the Strait of Hormuz. The loss of a long-standing member risks undermining the group’s cohesion, which has historically relied on presenting a unified stance despite internal divisions over geopolitical issues and production quotas.

Meanwhile, Gulf producers have already faced difficulties exporting oil through the Strait of Hormuz, a critical chokepoint between Iran and Oman that typically handles about one-fifth of global crude and LNG flows , due to Iranian threats and attacks on vessels.