טםThe decision by the United Arab Emirates to withdraw from the Organization of the Petroleum Exporting Countries (OPEC) reflects both the intensifying competition among Gulf states and the gradual erosion of the cartel’s status, which has controlled the global oil market for decades.
The UAE explains this dramatic move as stemming from the need for greater flexibility in its energy policy. OPEC production quotas limit its ability to realize the massive investments it has made in recent years to increase oil output. Abu Dhabi seeks to maximize revenues and expand its influence in the global energy market, and, in this sense, leaving the organization grants it broader freedom of action.
However, behind the economic explanation lies a political-regional dimension. In recent years, growing competition has developed between the UAE and Saudi Arabia over regional standing and economic influence. Both countries aim to establish themselves as leading economic hubs and often find themselves competing for the same international companies and resources. Within OPEC, where Riyadh holds dominant influence over production policy, Abu Dhabi’s freedom of action is more constrained.
The war with Iran has intensified this tension. From the UAE’s perspective, the war exposed its vulnerability and the limitations of Gulf solidarity. While Abu Dhabi expected a firmer regional stance toward Iran, Riyadh preferred a cautious policy and sought to avoid escalation. In Abu Dhabi, some believe that Riyadh even acted through diplomatic channels to ensure that its own exposure remained more limited. This perception has strengthened the Emirati desire to reduce dependence on a regional framework largely dominated by the Saudis.
At the same time, the decision also reflects a broader trend of OPEC’s weakening. Gradually, the organization’s ability to control oil prices has diminished, partly due to the rise of new producers led by the United States following the shale revolution. In such an energy reality, many producing countries seek greater flexibility in managing their resources. The decision to withdraw from OPEC likely matured over time within the UAE and follows the path of Qatar, which left the organization as early as 2019.
Ironically, at a time when threats to Gulf states are at their peak, these states struggle to present a unified front—partly because, behind the scenes, strategic competition among them continues to deepen.
טםThe decision by the United Arab Emirates to withdraw from the Organization of the Petroleum Exporting Countries (OPEC) reflects both the intensifying competition among Gulf states and the gradual erosion of the cartel’s status, which has controlled the global oil market for decades.
The UAE explains this dramatic move as stemming from the need for greater flexibility in its energy policy. OPEC production quotas limit its ability to realize the massive investments it has made in recent years to increase oil output. Abu Dhabi seeks to maximize revenues and expand its influence in the global energy market, and, in this sense, leaving the organization grants it broader freedom of action.
However, behind the economic explanation lies a political-regional dimension. In recent years, growing competition has developed between the UAE and Saudi Arabia over regional standing and economic influence. Both countries aim to establish themselves as leading economic hubs and often find themselves competing for the same international companies and resources. Within OPEC, where Riyadh holds dominant influence over production policy, Abu Dhabi’s freedom of action is more constrained.
The war with Iran has intensified this tension. From the UAE’s perspective, the war exposed its vulnerability and the limitations of Gulf solidarity. While Abu Dhabi expected a firmer regional stance toward Iran, Riyadh preferred a cautious policy and sought to avoid escalation. In Abu Dhabi, some believe that Riyadh even acted through diplomatic channels to ensure that its own exposure remained more limited. This perception has strengthened the Emirati desire to reduce dependence on a regional framework largely dominated by the Saudis.
At the same time, the decision also reflects a broader trend of OPEC’s weakening. Gradually, the organization’s ability to control oil prices has diminished, partly due to the rise of new producers led by the United States following the shale revolution. In such an energy reality, many producing countries seek greater flexibility in managing their resources. The decision to withdraw from OPEC likely matured over time within the UAE and follows the path of Qatar, which left the organization as early as 2019.
Ironically, at a time when threats to Gulf states are at their peak, these states struggle to present a unified front—partly because, behind the scenes, strategic competition among them continues to deepen.