BAKU, Azerbaijan, April 29. The exit of the
United Arab Emirates (UAE) from OPEC and OPEC+ is expected to
impact the oil market landscape in 2027 and beyond, Trend reports
citing Wood Mackenzie.


On 28 April 2026, the UAE announced its exit from OPEC and OPEC+
effective on 1 May 2026. The country’s Ministry of Energy and
Infrastructure said the decision follows a review of production
policy and capacity outlook and aligns with its strategy to
accelerate domestic energy investment. The UAE reaffirmed that its
production policies will be responsible and guided by market
stability.


“The UAE’s exit from OPEC is momentous, and undoubtedly the
biggest schism in the organisation since it was founded in 1960.
The UAE, a member since 1967, has risen by developing its vast
resources to become OPEC’s second-largest producer by liquids
capacity today,” reads the latest released by Wood Mackenzie.


Wood Mackenzie analysts point out that the UAE is in a unique
economic position to walk away from OPEC.


“It has a much larger share of unused productive capacity
compared with other members, that without the current restrictions
it can put to use. Furthermore, the UAE has much lower fiscal oil
price breakevens relative to its peers, leaving its economy
relatively resilient and better able to sustain a potential period
of low prices,” reads the report.







Wood Mackenzie experts note that the UAE’s decision to leave
OPEC comes at a moment when its short-term production capacity is
already limited due to the continued closure of the Strait of
Hormuz, which is constraining any immediate impact on global
supply. With around 2 million b/d of offshore output currently
offline, the country has limited room to raise production in 2026,
regardless of policy direction. Even after transit through the
Strait resumes, restoring output to pre-conflict levels could take
up to six months. As a result, the UAE’s withdrawal is expected to
have more significant implications for supply dynamics from 2027
onwards.


“The country has committed to investing US$145 billion (real,
2026) in its domestic upstream oil sector over 10 years to 2030.
The overarching goals are to sustain oil production and expand
capacity from under 4 million b/d in 2020 to 5 million b/d by 2027.
By 2024, capacity had reached 4.85 million b/d. OPEC+ quotas,
however, have constrained output well below capacity, to the UAE’s
growing frustration. In 2021, OPEC+ talks stalled as the UAE pushed
for a higher baseline. The eventual compromise, to raise the
baseline from 3.17 million b/d to 3.5 million b/d from May 2022,
only partially reflected capacity growth.


The UAE has the capability to take a growing share of global oil
demand in 2027 and beyond, which challenges OPEC’s current policy
of unwinding its voluntary cuts, and increases the risk of
oversupply weakening prices. If tensions escalate, competition
between the UAE and OPEC for market share could send medium-term
oil prices sharply lower,” note the analysts.