Why the United Arab Emirates walked away from Opec
The economic logic of the decision is just as important as the political one
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WHEN the United Arab Emirates formally exited Opec on Friday (May 1), the official statement spoke the bloodless language of bureaucracy: a decision rooted in “long-term strategic and economic vision” and the country’s “evolving energy profile”.
Strip away the diplomatic varnish and a more interesting story emerges. The UAE did not leave Opec because the cartel suddenly stopped working. It left because the cartel no longer fits the country the UAE has spent the last decade becoming.
For years, Abu Dhabi has chafed against Opec’s central instrument of power: the production quota. The UAE has poured tens of billions of dollars into expanding its capacity, with a target of five million barrels per day (bpd) by 2027, up from roughly three million a few years ago.
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