UAE's Opec exit seeks to hit Saudi Arabia where it hurts

On its face, this is not an unreasonable initial interpretation: the UAE has long wanted to break free of Opec oil output constraints to leverage its massive production capacity; the US-Israel war on Iran has produced economic volatility across the Gulf; and leaving Opec could produce long-term economic benefits for Abu Dhabi. Unlike Saudi Arabia, which relies heavily on higher oil prices to balance its budget, the UAE has invested heavily in expanding production capacity and prefers a high-volume export strategy, even if it results in lower per-barrel oil prices. But the context and timing of the UAE's gambit suggest it is at least as politically motivated as it is economic. First and foremost, the move should be seen as an attempt by the Emirati leadership to hit Saudi Arabia - the largest and most significant player in Opec - where it hurts. Even if greater oil revenues do not materialise, leaving Opec could still benefit Abu Dhabi if doing so gives it an edge in its budding rivalry with Riyadh. The UAE's exit may also trigger a 'domino effect' of additional departures, potentially leading to the breakdown of the entire cartel By abandoning production quotas, the UAE will undermine Saudi Arabia's oil price management approach, which involves enforcing limited oil production across the Opec group. As Opec's de facto leader, Saudi Arabia has long dictated a policy aimed at limiting oil production in order to keep prices higher. The Emirates' departure immediately weakens Opec, which will now have less control over oil production and less power to manage supply and influence global oil prices. If the UAE significantly increases output over time, it could push oil prices down - something that would directly undercut the Saudi economic model. The UAE's exit may also trigger a domino effect of additional departures, potentially leading to the breakdown of the entire cartel. Beyond economics Since normalising relations with Israel in 2020, the UAE has moved closer to both Tel Aviv and Washington. Both Israel and US President Donald Trump are likely overjoyed at the UAE's decision to leave Opec. Trump has long complained that Opec is ripping off the world and will almost certainly view the development as a political victory - not only because oil prices may fall, but also because the US energy market stands to benefit. Israel, which actively seeks to both fragment and weaken the Arab region, will be hopeful that the UAE's decision helps accomplish both aims. Importantly, following years of post-Arab Spring coordination and cooperation, the UAE and Saudi Arabia have split on a number of key regional issues, including Yemen, Sudan, Somalia and the US-Israel war on Iran. Riyadh has opposed Abu Dhabi's cosying up to Israel, and Saudi influencers have undertaken a campaign lambasting the UAE for allegedly serving as Israel's Trojan horse in the region. Saudi Arabia also opposes Emirati attempts to reshape the regional political order by supporting secessionist militias in Yemen, Sudan and Somalia. Riyadh, in contrast, has supported central governments across the region against non-state actors. In late 2025 and early 2026, Saudi Arabia directly targeted the Emirati-backed Southern Transitional Council (STC) in Yemen - a rare open escalation between two longstanding allies. The Saudis have also opposed the UAE's support for Somaliland authorities and Sudan's Rapid Support Forces (RSF). In recent weeks, during the US-Israel war on Iran, the UAE has reportedly received Israeli military assistance, while also pushing Israel and the United States to continue their campaign against Iran. The Saudis, meanwhile, have quietly worked diplomatic channels to end the war. The timing of the UAE's Opec announcement is also worth highlighting. The decision was revealed just as Gulf leaders were gathering in Jeddah for a high-level summit designed to show a unified Gulf stance towards the US-Israel war on Iran. In a meeting attended by heads of state from Qatar, Saudi Arabia and Bahrain, the UAE opted not to send President Mohamed bin Zayed, instead dispatching its foreign minister. The combination of timing and downgraded representation suggests a deliberate effort to undercut the summit's purpose. Future implications The fallout from the UAE's decision to leave Opec will be far-reaching. Beyond the weakening of Opec and its effects on both the Emirati and Saudi economies, the UAE will continue to move politically and economically closer to Israel, with which it has already established strong business, military and tourism ties. The emerging Israel-UAE axis could pose significant challenges not only for Saudi interests, but also for human rights causes in Palestine, Sudan and beyond. The growing split between the UAE and Saudi Arabia will force countries in the region to take sides. Egypt and Jordan may find themselves in particularly difficult positions. The Saudis, meanwhile, will almost certainly move further in the other direction, away from Israel. In September 2023, Saudi Crown Prince Mohammed bin Salman had been close to a normalisation deal with Israel. The Gaza genocide changed the Saudi calculation, however, making such a deal much less likely, at least in the short term. The UAE's exit from Opec, combined with the country's increased alignment with Israel and the now full-blown Saudi-Emirati rift, almost certainly renders normalisation with Israel out of the question for bin Salman. The growing split between the UAE and Saudi Arabia will force countries in the region to take sides. Egypt and Jordan - both heavily dependent on Gulf financial support - may find themselves in particularly difficult positions. A digital war reveals full scale of UAE-Saudi rift Read More » Since 2013, Egypt has received substantial backing from both Abu Dhabi and Riyadh, with the UAE investing heavily in infrastructure and development projects, while Saudi Arabia has provided critical financial support and energy assistance. Balancing these relationships will become increasingly difficult if the rift deepens. Jordan, which also relies on Gulf aid, will find itself in a similar predicament. Beyond Egypt and Jordan, other regional actors will also feel the pressure. Turkey has carefully navigated its relationship with both Gulf powers and may seek to exploit divisions, while Pakistan - already deepening its defence ties with Saudi Arabia - could be pulled further into the Saudi orbit. There is also growing speculation that the UAE may consider leaving other multilateral organisations, including the Arab League, the Gulf Cooperation Council (GCC) and the Organisation of Islamic Cooperation (OIC). Even if such departures do not materialise immediately, the mere threat could further cloud relations among Arab, Gulf and Islamic states. What once appeared to be a relatively unified Saudi-Emirati axis has given way to public competition and open hostility. In a region already marked by war and volatility, this new dynamic may prove far more consequential than any change in oil output. The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Middle East Eye. Gulf Tensions Opinion Post Date Override 0 Update Date Mon, 05/04/2020 - 21:29 Update Date Override 0