New Delhi: The United Arab Emirates (UAE) is all set to exit Organization of the Petroleum Exporting Countries (Opec) and the broader 22-member Opec+ alliance, from May 1, 2026. The Gulf nation’s decision is expected to benefit India as both the countries have cordial relations and have business ties.
Analysts are of the view that the UAE, after its exit from OPEC, would increase its crude oil production, which mat cool down global oil prices and help lower India’s oil import bill. Notably, the West Asia crisis, which has severely disrupted the strategic Strait of Hormuz, has led to high crude prices.
The UAE produces around 4.8 million barrels of crude per day.
WTI crude futures held above $99 per barrel after gaining more than 3% in the previous session, driven by escalating supply concerns. The closure of the Strait of Hormuz has halted around 20% of global oil shipments, with the IEA describing it as the largest supply shock on record. Stalled US-Iran negotiations and additional US measures, including possible sanctions on Chinese refiners and transit-related payments, have intensified geopolitical risks. Meanwhile, the UAE’s decision to exit OPEC next month signals shifting dynamics in global oil supply strategy, adding further uncertainty to already tight energy markets.
The UAE’s OPEC exit decision isn’t a surprise as rumors were doing rounds about the possibility for some time. “Having invested heavily in expanding energy production capacity in recent years, the bigger picture is that the UAE has been itching to pump more oil,” Capital Economics were quoted by AP. “The ties binding OPEC members together have loosened,” it said.