Why the UAE is leaving OPEC and what it means for the global oil market

Alexey Gromov, Principal Director on Energy studies at the Institute for Energy and Finance, commented to Forbes on the UAE's withdrawal from OPEC and OPEC+, as well as the general situation with a decrease in oil production and exports from the Persian Gulf countries amid the ongoing de facto blockade of the Strait of Hormuz.

The withdrawal of countries from the alliance does not lead to its collapse: Qatar and Angola left OPEC, but the alliance resisted, Alexey Gromov recalls.

"But in the current conditions of blocking the Strait of Hormuz, the strategic importance of OPEC+, by and large, if we are honest, is reduced to zero," he says. — A number of countries that violated OPEC+ voluntary restrictions were unhappy with its policy, not only the UAE. Among these were Kazakhstan, which is under pressure from foreign investors, and Iraq. It seems to me that the exit of such a large country as the UAE, which produced 3.5 million barrels per day of oil, may become the stone that can bring down at least OPEC+, but also OPEC, if the blocking of the Strait of Hormuz and problems in the oil market persist for at least the next month."

In the current conditions of blocking the Strait of Hormuz, OPEC+ is losing its market power, Gromov says. Countries that were unhappy with the alliance's production policy, including the UAE, clashed with the Saudi authorities. OPEC+ has created a negative image for itself in the eyes of those investors that the UAE is counting on, in particular the American ones.

"Just the other day, there was news that the UAE had requested financial support from the US Treasury Department in connection with the crisis in the Persian Gulf," the expert says."And it seems to me that they could well have received a recommendation from the American authorities: if you want our financial support, leave OPEC and OPEC+."

According to the data collected on April 21, the analyst says, the production of the Persian Gulf countries, including Qatar, which is not part of OPEC, decreased by 11.5 million b/d (46%) compared to the February volume of 24.9 million barrels and amounted to 13.4 million b/d. Before the conflict, the Persian Gulf countries accounted for about 30% of global oil production, which OPEC estimated at 104.8 million bpd in 2025. Qatar suffered the most, reducing production by 90%, Kuwait reduced it by 80%, Iraq — by 75%, the United Arab Emirates — by 55%, Saudi Arabia — by 33%, Gromov notes. Iran reduced production the least, by only 9%, as it had the opportunity to export its oil, he points out. "Since we understand that, strictly speaking, nothing is happening with the Strait of Hormuz, then, apparently, the reduced volumes will remain for the coming weeks," Gromov says.

There is another difficulty,in March, all the Gulf countries filled their oil storage facilities, not only on land, but also tankers at sea, there is nowhere to put new oil, and production will have to be reduced. It turns out that the volume of oil entering the market from the Persian Gulf countries may decrease even more, the expert believes.

Russia has serious problems with oil exports due to factors related not to the Middle East crisis, but to infrastructure damage in the main export ports — Primorsk, Ust-Luga on the Baltic Sea and Novorossiysk on the Black Sea, Gromov explains. Thus, we are not talking about increasing production, but about reducing it, if only because the country does not have strategic oil storage facilities. Everything is full, and Russia has no choice but to reduce production.

In principle, the overall picture is as follows: OPEC+ countries cannot offer anything radical to the market now, the expert notes. And if the blockade of the Strait of Hormuz by the United States and Iran continues for at least another month, we can be sure that world oil prices throughout 2026 will be at about $ 100 per barrel and above, he concludes.