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The United Arab Emirates has announced it will exit OPEC, ending more than six decades of membership in a move that reshapes global oil politics and underscores growing strain within the producer alliance.
Officials said the decision takes effect on 1 May, as the region grapples with the Iran conflict that has disrupted shipping through the Strait of Hormuz and tightened global supply chains.
UAE withdrawal is expected to weaken OPEC's ability to coordinate production, widening long-running disagreements with Saudi Arabia over output limits and the direction of the oil market.
Former US president Donald Trump, who has repeatedly criticised OPEC for inflating oil prices, is viewed by analysts as a political winner from the UAE's departure, which could increase future global supply once geopolitical risks ease.
Weeks of volatility have pushed oil prices above 110 dollars a barrel, though traders expect limited immediate disruption due to continued constraints in Gulf shipping routes and the UAE's gradual approach to raising output.
The decision also reflects a broader shift in energy strategy, as the UAE seeks greater flexibility to monetise its large reserves while accelerating investment in lower-carbon technologies and expanding its role as a global energy supplier beyond OPEC constraints.
Analysts say the exit could accelerate fragmentation within the wider OPEC+ alliance, reducing its influence over global supply management and potentially allowing producers with spare capacity to expand output more aggressively over time.
This shift raises questions about Saudi Arabia's role as the central stabilising force in oil markets, especially if key members begin prioritising national production goals over coordinated quotas.
It also reflects broader geopolitical realignments in the Middle East, where energy policy is increasingly tied to security concerns, investment flows and shifting alliances with global powers such as the United States.
While immediate market effects may be limited, the long-term outcome is expected to be a looser producer framework, greater output competition, and a more fragmented global oil order as countries adapt to shifting demand patterns and the gradual transition away from fossil fuels over the coming years as markets gradually rebalance and new supply routes emerge further globally.
