BAKU, Azerbaijan, April 30. The United Arab
Emirates’ (UAE) decision to exit OPEC+, effective May 1, has drawn
significant attention from oil market participants, reflecting a
long-brewing shift in strategy rather than a short-term reaction to
market conditions, Priya Walia, Vice President, Commodity Markets –
Oil at Rystad Energy, told Trend.
According to Walia, the move underscores years of tension
between Abu Dhabi’s ambitions to expand production capacity and the
constraints imposed by collective quota management within
OPEC+.
“The UAE’s exit does not materially alter near-term supply
availability, but it reflects a longer-term strategic shift toward
greater production flexibility as the country seeks to monetize its
expanding capacity base,” Walia said.
She noted that stepping outside the quota framework reshapes
market expectations and weakens OPEC+’s control over spare
capacity, as well as the assumption that future supply will
continue to be managed through coordinated restraint.
“Rather than moving cleanly in one direction, prices are likely
to become more volatile, driven increasingly by geopolitical
headlines rather than policy signals from OPEC+,” she said.
“Further out, as the market begins to rebalance, the weakening of
OPEC+ as a mechanism to coordinate supply could amplify downside
risks compared with previous cycles.”
Rystad Energy highlights that the UAE’s departure reflects a
long-standing mismatch between its upstream expansion plans and the
limits of collective production agreements.
Walia pointed out that despite receiving an additional 300,000
barrels per day (bpd) quota increase as part of the 2.2 million bpd
unwind in early 2025, the UAE has consistently operated below its
installed capacity. Prior to the current regional conflict,
production stood at around 3.4 million bpd, significantly below
capacity levels, before dropping to as low as 1.5 million bpd in
April 2026 due to war-related disruptions.
“The country’s expansion strategy, led by ADNOC, includes
several major brownfield projects. These include the Upper Zakum
Expansion 2 project, expected to add 200,000 bpd in 2026, Bu Hasa
with an additional 90,000 bpd in 2027, and South East Bab
contributing 130,000 bpd in 2028. With a target of reaching 5
million bpd in capacity by 2027 and ambitions to scale up to 6
million bpd thereafter, the quota system increasingly conflicted
with the commercial logic of these investments. The UAE’s exit also
has implications for OPEC+’s ability to respond to supply
disruptions.
As of February 2026, the group’s nominal spare capacity stood at
approximately 5.98 million bpd, including Saudi Arabia’s 750,000
bpd of overproduction relative to its quota. Of this total, the UAE
accounted for about 1.54 million bpd, roughly a quarter of the
group’s spare capacity. With Abu Dhabi now outside the framework,
OPEC+ effectively loses direct control over a significant portion
of this buffer, reducing its collective ability to respond to
market shocks,” she added.
While immediate production increases from the UAE are unlikely
due to ongoing regional constraints, Rystad Energy notes that once
conditions stabilize, additional volumes are likely to return on
commercial rather than coordinated terms.
“The UAE has been a consistent contributor to OPEC+ output, with
the eight-member grouping producing around 34 million bpd prior to
the conflict, accounting for roughly 38 percent of global crude and
condensate supply. Following the UAE’s exit, the remaining
seven-member group’s share of global supply is expected to decline
by around four percentage points. The divergence between an
eight-member and seven-member production base is likely to become
more pronounced in the second half of 2026, further reshaping
global oil market dynamics.”
