The Desert Dissenter

MBZ’s break with OPEC signals a louder shift in oil geopolitics

For a man who prefers deeds to words, Sheikh Mohammed bin Zayed Al Nahyan, President of the United Arab Emirates (UAE), has once again made news by saying very little. On April 28, the UAE, in a shock move, announced that it would withdraw from the Organization of the Petroleum Exporting Countries and its broader alliance, OPEC+, ending nearly six decades of membership. Against the backdrop of a world convulsed by the United States’ and Israel’s war on Iran, the terse announcement starkly captured the ever-changing dynamics of global energy, and of MBZ’s own ambitions.

To grasp the magnitude of the UAE’s exit, one must return to OPEC’s origins. Founded in 1960 in Baghdad by oil producers determined to wrest control from Western majors (the so-called ‘Seven Sisters’), the cartel had sought to stabilise prices and assert sovereignty over natural resources. For decades it had succeeded, most dramatically during the oil shocks of the 1970s. Yet its coherence has long been under strain. Members from Indonesia to Qatar have exited, chafing at quotas and divergent national interests.

The UAE’s departure, however, is of a different order. With a production capacity approaching 4.8 million barrels per day and ambitions to exceed 5 million by the decade’s end, Abu Dhabi is not a marginal player but a central pillar. Remaining within the cartel, in Emirati eyes, has meant accepting a structural discount on its own capacity.

The recent Iran conflict has sent tremors through energy markets, particularly around the Strait of Hormuz, through which a fifth of global oil flows. By exiting now, the UAE positions itself to capture the upside of the energy shock, unencumbered by collective restraint that other members may exercise.

But the move has equally to do with the UAE’s rivalry with Saudi Arabia, shaped by the personal friction between MBZ and Saudi Crown Prince Mohammed bin Salman, knowns as MBS. For much of the past decade, MBZ was seen as a guiding figure for the younger Mohammed bin Salman, particularly in matters of security and statecraft. Both men shared a distrust of political Islam, a willingness to centralise power and an appetite for economic transformation. But as MBS consolidated authority in Saudi Arabia, he entered into a contest with MBZ for primacy in the Gulf.

The rivalry now plays out across multiple theatres. Economically, Saudi Arabia’s Vision 2030 seeks to lure capital and talent away from Dubai, challenging the UAE’s status as the region’s commercial hub. Riyadh has tightened rules requiring multinational firms to base regional headquarters in the kingdom in an implicit bid to undercut Emirati advantage.

In energy policy, the divergence is starker still. Saudi Arabia has favoured tighter supply management to sustain prices, leveraging its role as OPEC’s de facto leader. The UAE, by contrast, has chafed at quotas that limit its expanding capacity. Disputes over baseline production levels have periodically flared into public disagreement. By exiting OPEC, Abu Dhabi is effectively rejecting Riyadh’s stewardship of the oil order.

Geopolitics has added further friction. While both states initially aligned in conflicts such as Yemen, their approaches have since diverged. The UAE has pursued a more nimble, networked strategy by cultivating ties with Israel through the Abraham Accords, deepening links with Asian powers and hedging its bets in an increasingly multipolar region. Saudi Arabia, under MBS, has sought to assert itself as the indispensable Arab power.

Since consolidating power, MBZ has recast the UAE from a cautious petrostate into an assertive middle power. Investments across Africa, partnerships in Asia and deepening ties with the United States have all served his aim of strategic autonomy. 

Equally important is the transformation of the Emirati economic model. The UAE is now building a diversified energy portfolio spanning gas, petrochemicals, hydrogen and logistics. Exiting the cartel allows the UAE to optimise across sectors, rather than fix policy around a single commodity.

For MBZ, the move to exit the cartel is a calculated gamble. While greater autonomy brings greater exposure to market swings, it also brings the freedom to exploit them. It enhances the UAE’s appeal as a flexible supplier and a strategic partner, particularly for countries seeking reliability amid turbulence. And it cements his reputation as a leader willing to redraw the rules rather than play by them.