The UAE’s departure from OPEC, which took effect on May 1, was planned over three years and is based on the belief that the world is nearing the end of reliance on oil. A senior adviser to President Sheikh Mohamed bin Zayed Al Nahyan stated that the UAE wants to maximize its oil revenue while it can. The decision is not expected to immediately impact the oil market due to the closure of the Strait of Hormuz by Iran but may significantly affect OPEC’s control over oil supplies once flows normalize.
Anwar Gargash, the adviser, explained that the UAE’s exit was largely due to OPEC production quotas that limited their output below capacity. The UAE has the capacity to produce 4.85 million barrels per day and aims to increase this to 5 million bpd by 2027, while previous targets under OPEC were around 3.5 million bpd. ADNOC CEO Sultan al-Jaber assured that the UAE would remain a stabilizing force in energy markets. Recently, tensions have grown between Saudi Arabia and the UAE, with disagreements on oil policy and regional geopolitics becoming more evident, especially during conflicts in Yemen.
With information from Reuters
