OPEC+ convened on May 3 for its first ministerial meeting since the United Arab Emirates’ surprise withdrawal from the oil cartel, in what analysts see as a critical test of the alliance’s cohesion amid unprecedented global energy market volatility.

The UAE announced its exit from OPEC+ earlier this week, sending shockwaves through oil markets. As the cartel’s third-largest producer, the UAE’s departure removes a key player from the global supply coordination mechanism. The move is widely viewed as reflecting deep-seated disagreements among producers over output quotas and long-term strategy.

According to sources familiar with the discussions, OPEC+ is planning to raise production quotas at this meeting despite the de facto blockade of the Strait of Hormuz. The proposal has drawn skepticism from market observers: with global energy supply already under severe strain from the Iran crisis, the wisdom of a production increase is being debated.

CNBC reports that some OPEC+ members argue that pre-announcing a production hike — even while Hormuz passage remains restricted — could signal “adequate supply” to markets and help cap further oil price surges. Critics, however, warn the move could be interpreted as evidence of internal disunity, further eroding market confidence.

International oil prices have continued climbing due to the Iran conflict and Hormuz Strait crisis, with Brent crude breaching $125 per barrel. Global stock markets remain volatile as investors closely watch OPEC+ decisions for their broader impact on energy geopolitics.

The outcome of this meeting will directly shape global oil supply expectations for the coming months, with ripple effects on US inflation pressures, European energy security, and the economic outlook for emerging market nations.

Sources: Bloomberg, CNBC

Multiple chief executives of major international oil companies have issued stark warnings at recent industry conferences, stating that persistent geopolitical crises and structural tensions in global energy supply chains are pushing markets toward a “cliff’s edge,” with potentially devastating consequences if key shipping routes are disrupted.

Hormuz Strait Crisis Heightens Supply Concerns

The core of the warnings centers on the Strait of Hormuz — the narrow waterway through which approximately one-fifth of the world’s oil supply passes. Since the escalation of tensions between Iran and the United States, security risks in the region have continued to mount. While both sides have engaged in discussions regarding the “termination” of the conflict, the actual safety of passage through the strait remains unsecured.

“We are at an extremely fragile moment,” said one senior executive at a major international energy company, speaking on condition of anonymity. “Any further shock to the supply chain could trigger a cascading effect.”

Global Stockpiles at Dangerous Lows

Analytical data shows that global strategic petroleum reserves and commercial inventories have fallen to their lowest levels in years. In the United States, gasoline prices continue to climb, with the national average surpassing $4.30 per gallon in some regions. European energy prices are similarly under pressure, with the Bank of England recently holding interest rates steady due to energy-driven inflation concerns.

Oil industry executives note that current market conditions bear similarities to historical crisis periods, but the world’s capacity to buffer against supply shocks is significantly diminished. The International Energy Agency (IEA) has previously called on member countries to prepare for potential supply disruptions.

Underinvestment Creates Long-Term Vulnerabilities

Beyond the immediate geopolitical risks, oil executives also warned about the long-term problem of underinvestment. In recent years, capital expenditure in traditional oil and gas has fallen significantly under pressure from the global energy transition. This has resulted in new production capacity failing to keep pace with demand growth, particularly in emerging and developing markets.

“We face a paradox: on one hand, the world’s dependence on fossil fuels cannot be eliminated in the short term; on the other, investment in traditional energy continues to decline,” noted another industry leader. “This imbalance will ultimately be paid for by consumers.”

OPEC+ Outlook Uncertain

Meanwhile, the UAE’s earlier decision to withdraw from OPEC has further compounded market uncertainty. As a major oil producer, the UAE’s departure weakens OPEC+’s ability to coordinate supply, making the global oil market’s management mechanisms more fragile.

Market analysts expect energy prices to continue being driven by geopolitical events and supply-side factors in the coming weeks, with volatility likely to increase further.

Source: Bloomberg | Moneycontrol

Abu Dhabi — The United Arab Emirates announced on Thursday that it will exit the Organization of the Petroleum Exporting Countries (OPEC), a decision that sent shockwaves through global energy markets. As OPEC’s third-largest oil producer, the UAE’s departure will profoundly alter the organization’s production quota system and the global crude oil supply landscape.

Analysts point out that the UAE’s decision is closely tied to its energy strategy adjustments during the Iran war. The conflict has disrupted navigation through the Strait of Hormuz, prompting the UAE to seek greater autonomy in its energy exports. After leaving OPEC, the UAE will no longer be bound by the organization’s production quotas and will be free to determine its own crude oil production and export strategy.

Meanwhile, ceasefire negotiations between the U.S. and Iran remain at an impasse. Despite the Trump administration declaring that military operations have been “terminated,” the two sides still have serious分歧 on key issues such as nuclear programs and sanctions relief. According to AP News, Iran previously offered to reopen the Strait of Hormuz if the U.S. lifted its blockade and ended the war, but Washington has not yet responded definitively.

In markets, international oil prices showed volatility following the announcement. Brent crude was quoted at $106.33 per barrel, up 1.2%. The U.S. 10-year Treasury yield remained at 4.39%. U.S. stock futures edged slightly higher, with Dow futures up 0.11% and S&P 500 futures up 0.16%.

Energy analysts warn that the UAE’s exit from OPEC could trigger a chain reaction among other member states, particularly Gulf producers dissatisfied with production quotas. If more countries follow suit, OPEC’s influence over global oil prices could be significantly weakened.

Source: AP News | CNBC

April 29, 2026 — The United Arab Emirates’ plan to leave the Organisation of the Petroleum Exporting Countries (OPEC) and strike out alone is being viewed as a massive blow to the organisation, with one analyst describing it as “the beginning of the end of OPEC.”

The announcement comes at a time of significant volatility in the oil market, with the US-Israel conflict with Iran triggering the biggest loss of oil supply on record, according to the World Bank.

What Is OPEC?

OPEC was formed in 1960 by Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela to defend the interests of major oil exporters by coordinating production to ensure steady revenue for its members.

In addition to its five founding members, OPEC currently includes Algeria, Equatorial Guinea, Gabon, Libya, Nigeria, and the Republic of the Congo. In 2016, when oil prices were particularly low, OPEC joined forces with 10 other oil producers, including Russia, to create the wider OPEC+ alliance.

How Does OPEC Influence Oil Prices?

OPEC aims to influence the global price of oil by agreeing how much its members sell. When they increase production, the goal is to lower prices by ensuring ample supply; when they cut production, the aim is to keep prices high when demand is lower.

In October 1973, Arab oil producers placed an embargo on countries led by the US, causing oil prices to more than double and triggering fuel rationing. More recently, during the coronavirus pandemic, OPEC+ slashed production to boost prices.

UAE Is OPEC’s Third-Biggest Oil Exporter

Based on 2025 data, the UAE exports approximately 2.88 million barrels of crude oil per day, trailing only Saudi Arabia (6.43 million bpd) and Iraq (3.26 million bpd). The UAE’s departure will directly reduce OPEC’s ability to control supply in the global market.

OPEC’s Enforcement Challenges

Maurizio Carulli, global energy analyst at Quilter Cheviot, notes that OPEC’s influence on oil prices has historically been “variable” because individual members “often do not actually respect the commitment” — either overproducing to gain greater market share or underproducing due to technical difficulties. He cited instances of Kazakhstan and the UAE itself exceeding agreed production levels.

The UAE’s exit could trigger a chain reaction, further weakening OPEC+’s coordination ability and market influence at a time when global oil markets are already under severe stress.

Source: BBC News

The United Arab Emirates has announced it will leave the Organization of the Petroleum Exporting Countries (OPEC) and the wider OPEC+ alliance next month, ending nearly six decades of membership dating back to 1967. The UAE stated the decision would help it meet growing global energy demand in the long term.

The exit is being viewed as a significant blow to the cartel. Saul Kavonic, head of energy research at MST Financial, described the departure as “the beginning of the end” for OPEC. “With the UAE leaving, OPEC loses about 15% of its capacity and one of its most compliant members,” he said.

The move is also seen as a win for U.S. President Donald Trump, who has previously attacked OPEC for “ripping off the rest of the world.” In January, he called on Saudi Arabia and other OPEC nations to “bring down the cost of oil” and doubled down on threats to impose tariffs. The UAE’s departure also opens the door for closer ties between the two countries.

According to the latest OPEC figures, the UAE produced 2.9 million barrels of oil per day in 2024, compared to Saudi Arabia’s 9 million barrels as the cartel’s de facto leader. Experts suggest the UAE could boost its oil production by approximately 1 million barrels per day outside of OPEC.

The UAE’s energy minister said that operating without the group’s production quotas would give the country greater flexibility. The Gulf state has invested heavily in expanding its production capacity but has long chafed under OPEC’s output restrictions.

The World Bank has simultaneously warned that the war in the Middle East has caused the biggest loss of oil supply on record. World Bank chief economist Indermit Gill noted that energy prices will rise by about a quarter on average this year, and it could take six months for shipping through the key Strait of Hormuz to return to pre-war levels.

Professor David Elmes of Warwick Business School pointed out that the UAE has one of the lowest break-even prices for its oil — nearly half that of Saudi Arabia — meaning it can remain profitable even at lower price points. “So the UAE wants to sell more and is less concerned with keeping prices high,” he said.

David Oxley, chief climate and commodities economist at Capital Economics, warned that the UAE’s departure could lead to lower oil prices but higher market volatility in coming decades. The implications could be far more significant if other member states follow suit, or if Russia and Saudi Arabia decide to ramp up production in response.

Source: BBC News

On April 28, 2026, the United Arab Emirates officially announced its withdrawal from the Organization of the Petroleum Exporting Countries (OPEC), a decision widely seen as a major blow to the world’s largest oil-producing alliance that could reshape the global energy landscape.

The Announcement and Its Rationale

In a statement, the UAE’s Ministry of Energy said the decision to leave OPEC aims to “help the country meet growing global energy demand in the long term.” The Gulf state has made significant investments in boosting its oil production capacity and seeks greater flexibility in its energy policy.

The UAE’s Energy Minister noted that being a country with no obligations under the OPEC framework would give it “more flexibility” in setting its energy strategy. This means the UAE will be free to expand or reduce its oil production independently, without being bound by the collective output agreements of the cartel.

“The Beginning of the End of OPEC”

A senior oil market analyst described the UAE’s departure as “the beginning of the end of OPEC.” This assessment reflects deep concerns about the organization’s future influence.

Since its founding in 1960, OPEC has been one of the most important coordinating bodies in the global oil market. The organization has influenced global oil prices by coordinating member production levels, playing a pivotal role in global economics and energy security. However, in recent years, OPEC’s market control has weakened significantly, driven by the surge in U.S. shale oil output and growing divisions among member states.

The UAE’s exit further erodes this influence. As a major OPEC producer with daily output exceeding 3 million barrels, the UAE’s departure means the cartel loses a key participant in its production coordination mechanism.

A Win for Trump

The UAE’s decision is also seen as a policy victory for U.S. President Donald Trump, who has repeatedly criticized OPEC in the past, accusing the organization of “ripping off the rest of the world.” In January, he asked Saudi Arabia and other OPEC members to lower oil prices to ease global energy cost pressures.

Analysts suggest the UAE’s exit from OPEC could pave the way for closer energy and economic ties between the UAE and the United States. This shift may give Washington greater influence in shaping global energy policy.

Market Implications

While the UAE’s departure is unlikely to have an immediate impact on current oil embargoes and prices, its long-term consequences could be profound. BBC Business Editor Faisal Islam analyzed that “it will change everything afterwards.”

Global oil markets will closely monitor the reactions of Saudi Arabia and other OPEC members in the coming weeks, as well as the direction of the UAE’s independent production policy.

Source: BBC News - UAE to quit oil cartel Opec; BBC Analysis - Why UAE’s exit from Opec is a big deal

The United Arab Emirates (UAE) officially announced on April 28, 2026, that it is withdrawing from the Organization of the Petroleum Exporting Countries (OPEC) and the broader OPEC+ alliance, a decision that deals a significant blow to the oil cartel at a time when global energy markets are already under severe strain.

Exit Context: Strait of Hormuz Crisis

The UAE’s departure comes amid the ongoing Strait of Hormuz shipping crisis triggered by the Iran war. The world’s most critical oil transit route — carrying approximately 20% of global daily oil shipments — is currently severely disrupted, with Gulf producers struggling to export their petroleum.

Analysts note that the UAE is seeking greater production flexibility. Under the OPEC+ framework, member states are bound by production quotas, but the UAE has significantly expanded its oil production capacity in recent years and wants the freedom to set its own output levels. The current Hormuz crisis intensifies this imperative — even if the strait reopens, shipping insurance costs could surge to 20 times pre-war levels.

Impact on OPEC

As OPEC’s third-largest producer with daily output of approximately 3 million barrels, the UAE’s departure weakens OPEC+’s collective production coordination capacity and deepens fissures within the organization. Saudi Arabia, OPEC’s de facto leader, has already been struggling to balance market share and price stability objectives, and the UAE’s exit compounds these challenges.

According to The Washington Post, the withdrawal is described as “a blow to Saudi Arabia.” OPEC+, formed in 2016, has coordinated member production to stabilize global oil prices, but internal tensions have escalated in recent years, with multiple members dissatisfied with quota allocations.

Market Reaction

Following the announcement, international oil prices showed significant volatility. Brent crude and WTI futures both rose during intraday trading, reflecting market expectations of potentially major changes in global oil supply dynamics.

Energy analysts warn that the UAE’s exit could trigger a domino effect, with other quota-dissatisfied members potentially considering similar moves. This would have profound implications for global energy market stability and the future of OPEC+.

Geopolitical Implications

The UAE’s decision is not merely economic but reflects deep shifts in Middle Eastern geopolitics. Against the backdrop of the Iran war, Gulf states are reassessing their security strategies and energy policies. The UAE is seeking to reduce its dependence on collective security frameworks while pursuing greater autonomy on the international stage.

The UN Secretary-General has previously warned that the US-Iran standoff in the Strait of Hormuz risks triggering a global food emergency, underscoring the worldwide ramifications of regional instability. The UAE’s exit further complicates an already tense situation.

Sources: Al Jazeera | The New York Times | Fox Business

The United Arab Emirates announced on April 28 that it will formally withdraw from the Organization of the Petroleum Exporting Countries (OPEC) on May 1, ending nearly six decades of membership that began in 1967. The shock deal is seen as a potential death knell for the cartel that coordinates production among the world’s largest oil producers.

Background: Iran Attacks and the Hormuz Crisis

CNBC reported that the announcement comes after the UAE has been the target of missile and drone attacks for weeks by fellow OPEC member Iran. Tehran’s attacks on shipping in the Strait of Hormuz have severely constrained the UAE’s ability to export oil, directly threatening the foundation of its economy. As OPEC’s third-largest producer behind Saudi Arabia and Iraq, the UAE’s departure further shrinks the cartel’s global market share.

Ambitions for Capacity Expansion

UAE Energy Minister Suhail Al Mazrouei told CNBC that the UAE’s exit is aimed at gaining greater freedom of action to pursue its goal of achieving 5 million barrels per day of production capacity by 2027. He explicitly denied that the decision was a response to years of production cuts led by Saudi Arabia.

“This has nothing to do with any of our brothers or friends within the group,” Al Mazrouei said. “We’ve been working together for years and years. We have the highest respect for the Saudis for leading OPEC.”

“Least Disruptive” Timing

Al Mazrouei emphasized that the UAE chose to exit at the “least disruptive” time: “Our exit at this time is the right time for it, because it will have a minimum impact on the price and it will have a minimum impact on our friends at OPEC and OPEC+.”

The UAE Energy Ministry said in a written statement that the country concluded leaving the organization was in its national interest following a comprehensive review of its production policy and capacity. The statement reaffirmed the UAE’s commitment to market stability and its intention to continue cooperating with producers and consumers.

Global Market Reaction

International oil prices fluctuated following the announcement. Analysts suggest the UAE’s departure could trigger a chain reaction, particularly if other producers dissatisfied with OPEC production quotas follow suit. BBC analysis noted that the UAE’s decision could mark the beginning of the end for OPEC as an effective cartel.

The UAE joined OPEC in 1967, just seven years after the organization was founded. Over nearly six decades, the Gulf state played an influential role in OPEC’s decisions, particularly in coordinating production policy among Middle Eastern oil producers.

Source: CNBC | BBC | Reuters

The United Arab Emirates officially announced on April 28, 2026, through state media that it will withdraw from the Organization of the Petroleum Exporting Countries (OPEC) and its broader alliance OPEC+, effective May 1. This marks the most significant member departure since OPEC’s founding in 1960 and carries profound implications for global energy markets and geopolitical dynamics.

The UAE stated that the withdrawal decision was driven by “national interests.” Multiple news outlets report that the UAE plans to gradually increase its crude oil production, freeing itself from OPEC+ output quotas. As OPEC’s third-largest producer with approximately 3 million barrels per day, the UAE’s departure will significantly weaken OPEC+’s grip on global oil supply.

The announcement comes against the backdrop of an escalating Iran war and heightened tensions in the Strait of Hormuz. CNN described the UAE’s exit as “a major blow to the world’s leading oil exporters group.” The Guardian noted it represents “a win for Trump as the oil cartel is weakened.”

Energy analysts warn the move could trigger a cascade effect. With the Iran war intensifying uncertainty around Middle Eastern energy supplies, other OPEC members may also reassess their positions within the alliance. Oil markets reacted swiftly to the news, with international crude prices surging and energy stocks outperforming on Wall Street.

OPEC+, established in 2016, has served as the most critical coordination mechanism in the global crude market. The UAE’s departure not only strips the organization of a major producer but also threatens to erode trust within the alliance, making future production coordination increasingly difficult.

Source: Reuters, Al Jazeera, CNN