Arabic,(BR TV)_For years I have been closely following Emirati-Saudi relations. I can say that today we are facing the most dangerous decision affecting bilateral relations in many years, and its geopolitical repercussions will be significant.
The UAE’s withdrawal from OPEC is more of a political rebellion against Saudi Arabia than an economic move.
This step is not merely an “economic choice” resulting from a desire to increase production, but has become an expression of an existential shift in Emirati policy, especially after the Iranian war.
The UAE promotes the idea of withdrawing from OPEC as a response to “broken promises” regarding Arab solidarity. However, the truth is that the UAE’s exit from OPEC represents a “seismic shift” that could end the era of Saudi dominance over regional energy policies.
This will open the door to drawing up a map of Emirati relations outside the Arab system, especially with regard to Israel and the United States.
I will explain this in great detail and depth to those interested.
There was a historical dispute between Saudi Arabia and the UAE in OPEC+ that changed production policies. The UAE decided to address the difference by bypassing consultation and coordination with the Kingdom.
Saudi Arabia needs high prices (above $80) to finance its Vision 2030 projects, which is why it adheres to production cuts through OPEC. In contrast, the UAE has a more diversified economy and some of the lowest production costs globally, making it preferable to increase sales volume even if prices fall slightly to ensure a larger market shareIn recent years, the relationship between Riyadh and Abu Dhabi has transformed from a close alliance to fierce economic competition. The withdrawal from OPEC represents the official declaration of the end of economic dependence on Riyadh’s policies and the adoption of an extreme nationalism that prioritizes Emirati interests above any consideration of Gulf solidarity.
The Gulf Cooperation Council suffers from institutional weaknesses that make decisions hostage to personal relationships between leaders. With the widening gap in positions on Iran and Yemen, oil has become the last remaining arena for coordination, and the UAE’s withdrawal will lead to the Council fracturing into competing blocs.
The UAE withdrawal will weaken the OPEC+ alliance in a way that it may never recover from.
The UAE acts as a safety valve within the alliance to counterbalance Russia’s “undiscipline,” which often produces beyond its quota to finance its war effort. Without the UAE, Saudi Arabia would find itself alone in confronting “free riders” like Moscow, potentially pushing Riyadh to launch a devastating “price war” to restore discipline, as happened in 2020.
On the international stage, this decision will represent a redrawing of the maps of geopolitical influence.The United States views OPEC as a cartel that serves Russian interests and harms the American consumer. The UAE’s withdrawal would be considered a major victory for US foreign policy because it would dismantle the unified Arab-Russian oil decision-making process and weaken OPEC’s ability to use oil as a political weapon. The compass of global demand is pointing towards Asia (China and India). The UAE is seeking to sign direct supply agreements with these powers, at the expense of OPEC’s ability to control crude oil flows to the East.The UAE’s ambitions extend beyond selling crude oil; it seeks to become a global hub for hydrogen, ammonia, and renewable energy. This transformation requires immediate and substantial financial liquidity, and withdrawing from OPEC is the key to unlocking this liquidity through maximum production.And in the real details behind the Emirati decision The UAE is adopting a strategy based on producing as much oil as possible now to finance the transition to a green economy. There is a consensus that the golden “window of demand” for fossil fuels may close by 2040.
🔷 Therefore, Abu Dhabi sees keeping oil underground in compliance with OPEC quotas as a risk of creating “stranded assets” that have no value in the future.
🔷 The UAE has invested more than $122 billion to raise its production capacity to 5 million barrels per day by 2030. However, OPEC quotas continue to force the country to produce at levels far below its actual capacity (around 2.6 to 3.1 million barrels per day in previous agreements) Also, launching Murban crude as a global pricing benchmark requires supply flexibility that OPEC does not provide; the UAE aspires for Murban to be a competitor to Brent and Texas crude, and this requires letting market forces determine the size of production, not the political decisions of the organization in Vienna.
