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Opinion National Interest PoV 50-Word Edit

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Society & Culture Around Town Book Excerpts Vigyapanti The Dating Story

More Judiciary Education YourTurn Work With Us Campus Voice

UAE’s ability to pursue its interests is unmatched

UAE has deep ties with US even as its financial centres help Russia evade sanctions, and it partners with Turkey despite Ankara’s tilt toward Saudi Arabia and Qatar.

The UAE has exited OPEC. Most discussion has revolved around three takeaways. While relevant, they are not sufficient to understand the UAE’s long-term trajectory, which is significant for its partners, New Delhi being an important one.

So, what are these three commonly cited points?

First, this decision has been a long time in the making. The UAE has repeatedly signalled divergence from OPEC’s production quotas— both cuts and increases. Abu Dhabi joined the cartel in 1967, seven years after its formation. More broadly, OPEC itself has never been static; its membership has expanded and shrunk over time. And this is not just about the less formal OPEC . Even within the formal core of OPEC players, membership has been fluid.

Ecuador left in 1992, rejoined in 2007, and then quit again in 2020; Gabon left in 1995 and returned in 2016; Indonesia left in 2009, rejoined briefly in 2016, and exited the same year again. Qatar became the first Middle Eastern country to leave in 2019 (to prioritise LNG and political differences with Saudis), with the UAE now second to do so.

Second, the move makes economic sense. Exiting cartel constraints allows the UAE to maximise its production capacity. Under OPEC quotas, its output remained around 3 million barrels per day, despite a capacity closer to, or even exceeding, 5 million.

This is rational actor behaviour: if global oil demand is expected to peak and eventually decline within the next decade, producers have an incentive to monetise reserves while the sun shines.

Beyond that, the UAE is right to see diminishing returns in collective cartel bargaining to set oil prices, when its breakeven price is much lower than Saudi Arabia’s, and greater value in flexibility — pursuing a more agile oil strategy, expanding into Mediterranean and North African markets without requiring consensus from the cartel.

Third, the exit reflects a deepening competitive dynamic within the Gulf—something akin to a “cold war” between UAE President Mohammed bin Zayed (MBZ) and Saudi crown prince Mohammed bin Salman (MBS). This is not merely personal but now structural, driven by competing ambitions and statecraft increasingly getting irreconcilable.

A longer discussion on the Emirati trajectory is very much the need of the hour.

Also Read: UAE’s exit from OPEC means a Gulf energy system that’s more responsive to Asian demand

All the kingdoms of Arabia

It is true that the Gulf, like any other geopolitical region, is not a monolith. Tribal affinities, historical experiences,........

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