UAE Exit from OPEC Could Boost Gulf Oil Production, Pressure Prices - Analysts

MOSCOW, April 29. /TASS/. The United Arab Emirates' decision to exit OPEC and OPEC+ could lead to additional growth in oil production in the Persian Gulf starting in 2027 and increase downward pressure on prices after the Strait of Hormuz is reopened, Alexey Belogoryev, research director at the Institute of Energy and Finance, told TASS. "The market will clearly perceive this as evidence of additional growth in oil production in the Persian Gulf starting in 2027 and as a likely incentive to ease quotas for the remaining OPEC+ countries. This does not affect current oil supply constrained by the closure of the Strait of Hormuz, but it will increase downward pressure on oil prices after it is reopened," Belogoryev said. Editor-in-chief of InfoTEK Alexander Frolov also did not rule out increased competition in the market following the restoration of oil supplies. According to him, if the UAE sharply ramps up production, it could trigger a response from OPEC+ and put the very existence of the format at risk. According to TASS calculations based on OPEC data, the UAE accounted for 11% of OPEC oil production in 2024 and 7.3% of OPEC+ output. Earlier, the Emirati state news agency WAM reported that the UAE had decided to withdraw from OPEC and OPEC+ starting May 1, 2026. According to WAM, the UAE's decision is in line with the country's long-term economic strategy.