(Source: Jiemian News 2026-04-29)
The UAE suddenly announced on Tuesday that it will officially withdraw from the Organization of the Petroleum Exporting Countries (OPEC) and the "OPEC+" alliance starting on May 1. As OPEC's third largest oil producer, the UAE's move may prompt more countries to follow suit, significantly weakening OPEC's pricing power over global crude oil.
The outside world generally regards the UAE's withdrawal as "the beginning of the end of OPEC." In fact, the UAE is not the first oil producer to withdraw from OPEC. In 2019, Qatar withdrew from OPEC, and in 2024, Angola also withdrew from the organization. However, the crude oil production of these two countries accounts for a very low proportion in the world, and the actual impact is limited.
Analysts pointed out that the UAE’s withdrawal from OPEC was not a sudden decision, but the concentrated outbreak of multiple contradictions after a long period of accumulation. More importantly, the UAE's withdrawal from the group will have a profound impact on the global oil supply pattern: OPEC's ability to regulate oil prices will be weakened, global supply elasticity will increase, and energy governance may enter an era of multi-polarity.
From the perspective of experts, there are three deep-seated reasons behind the UAE’s withdrawal from OPEC. The first is the huge gap between production capacity and quotas. Hongyuan Futures analyst Wang Wenhu told Jiemian News that the UAE has invested heavily in recent years to increase crude oil production capacity to 4.8 million to 5 million barrels per day. However, due to long-term quota restrictions from "OPEC+", the actual production capacity has been suppressed to between 3 million and 3.2 million barrels per day. Withdrawing from OPEC will allow the UAE to release idle production capacity and achieve its goal of increasing production by 30%.
Dong Xiucheng, Executive Dean of the China International Carbon Neutral Economic Research Institute, w88 casinoalso believes that the UAE’s move is aimed at releasing production capacity at its own pace. He told Jiemian News that the UAE had previously planned to increase oil production by about 30%, but it was difficult to achieve it under the existing OPEC and "OPEC+" mechanisms. A large amount of production capacity was idle, making it difficult to recoup its investment.
The second is the deep demand for strategic autonomy.Dong XiuchengAnalytics say that OPEC has long been dominated by Saudi Arabia. As the third largest oil producer in the organization, the United Arab Emirates lacks a voice. It has had many disagreements with Saudi Arabia over production and quota issues in history, and has a long history of grievances. In 2021, a fierce confrontation broke out between the two sides over a dispute over benchmark output.
The current conflict between the United States, Israel and Iran has further catalyzed the need for strategic autonomy.Dong Xiuchengpointed out that in the face of the continued tense situation in the Middle East, the UAE is unwilling to be bound by the collective position of OPEC and instead seeks to independently balance its relations with the United States, Saudi Arabia, and Iran to ensure its own energy security and diplomatic space.
Wang Wenhu also said that during the war between the United States and Israel, the UAE's attitude towards Iran was more hostile than that of Saudi Arabia and other Gulf countries. One key reason is its geographical advantage: the UAE's Fujairah port is located in the Gulf of Oman and is not subject to the blockade of the Strait of Hormuz. After withdrawing from OPEC, the UAE can take advantage of the high oil price window to increase production, thereby more flexibly connecting its oil production capacity to the global market and seeking a more favorable position in relations between major powers.
The third is the demand of the era of economic transformation. Dong Xiucheng pointed out that the UAE is accelerating the promotion of a "post-oil economy", but it still needs to maximize oil revenue in the short term. In the medium to long term, global energy demand will grow steadily, and the UAE hopes to seize more market share, attract international investment, and better connect with major consumer markets such as Asia.
OPEC was founded on September 14, 1960 in Baghdad by the five countries Iran, Iraq, Kuwait, Saudi Arabia and Venezuela. Prior to this, the global crude oil market had long been dominated by Western oil giants represented by Exxon, Shell, and BP. These multinational oil companies rely on the concession system to seize oil resources from oil-producing countries at extremely low costs. Although oil-producing countries have resource sovereignty, they have almost no say in pricing.
In August 1960, Standard Oil Company of New Jersey unilaterally lowered the price of Middle East crude oil by 14 cents per barrel, a decrease of about 7%, without consulting the oil-producing countries. This move completely angered oil-producing countries. In response, representatives from the five countries gathered in Baghdad and announced the establishment of a permanent organization - the Organization of the Petroleum Exporting Countries, or OPEC for short. Its original intention is to coordinate and unify the oil policies of member states, break the monopoly of Western oil companies, and safeguard the common interests of oil-producing countries. Since then, OPEC members have continued to expand. The Emirate of Abu Dhabi joined in 1967. The United Arab Emirates inherited its seat after the founding of the country in 1971. Qatar, Libya, Nigeria and other countries have successively become members. By the early 1970s, OPEC gradually regained oil pricing power and resource sovereignty through a series of struggles.
After entering the 21st century, OPEC faces new challenges. On the one hand, the U.S. shale oil revolution is developing rapidly, and shale oil production has increased significantly, seizing the market share of traditional oil-producing countries; on the other hand, international oil prices have continued to fall after 2014, and oil-producing countries are facing severe financial pressure.
In this context, OPEC realizes that it is no longer able to effectively influence the global oil market on its own. In December 2016, 13 OPEC members and 11 non-OPEC oil-producing countries led by Russia reached a joint production reduction agreement, marking the formal establishment of the "OPEC+" mechanism. According to the International Energy Agency, the total output of the "OPEC+" alliance currently accounts for about half of the global crude oil supply, of which the 12 OPEC members contribute about one-third, and 10 non-OPEC oil-producing countries such as Russia contribute about 20%.
As a core member of OPEC, the UAE’s withdrawal will undoubtedly have a profound impact on OPEC and global energy governance.
Dong Xiuchengstated that the UAE's withdrawal will severely damage OPEC's organizational cohesion, weaken its execution ability of "cutting production and ensuring prices", and may trigger a domino effect - other Gulf countries may follow suit and withdraw, and OPEC's influence on global oil pricing will decline significantly. According to Wang Wenhu's calculations, in terms of production, after "OPEC+" loses the UAE, its total crude oil production (excluding condensate, etc.) will drop from 37% to 32% of the world's total, and its spare production capacity will decrease by 1 million to 1.8 million barrels per day, and its ability to regulate global oil prices will be significantly weakened.
Wang Wenhu said that the UAE's withdrawal from the group marks significant progress in the US strategy of dismantling OPEC and reshaping the energy order, and that global energy governance may enter an era of multi-polarity. At the same time, in the Gulf region, the rift between the UAE and Saudi Arabia has become public, making the regional energy and geopolitical game more complicated, and the power structure of the Middle East is facing reshaping.
In addition, in terms of international oil price trends, in the short term, the UAE's increase in production will help restrain oil prices from rising further and hedge the supply risk premium in the Middle East; in the medium and long term, global supply elasticity will increase, OPEC's ability to "control prices" will weaken, and the market will become more diversified and competitive.
For China, the UAE’s withdrawal from OPEC has brought about both opportunities and challenges.
Wang Wenhu analyzed that the weakening of OPEC’s power to set global oil prices will make competition among oil-producing countries more intense. For China, as a net oil importer, this means that supply sources will become more diversified and its bargaining power is expected to be further enhanced. But at the same time, we need to be vigilant. The volatility of geopolitical risks in the Middle East may intensify, and the uncertainty of cooperation between China and Middle Eastern countries may increase accordingly.
He also said that the petro-renminbi may usher in new opportunities. At present, the proportion of RMB settlement in Iran's crude oil w88 with China has exceeded 90%. Saudi Arabia has also begun to try to settle oil in RMB. The share of RMB settlement in global oil w88 is rapidly expanding. This trend will undoubtedly enhance the status of the petro-yuan and make it the ballast stone for the internationalization of the renminbi.
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