The United Arab Emirates’ decision to leave the Organization of the Petroleum Exporting Countries(OPEC) and OPEC+ reflects a strategic pivot toward a future of declining oil demand and reduced cartel influence, according to energy strategist Kingsmill Bond.
Speaking in an interview on Al Jazeera, Bond, an analyst at Ember, said the timing of the UAE’s exit was deliberate and aligned with shifting market conditions.
“Well, they have long chafed, but it is a very clever moment to do it when there’s an oil shortage anyway. And therefore, they are preparing themselves clearly for the period after the war, because now that we’ve obviously reached peak oil demand, and we are entering into a new environment, they want to be free from the constraints of OPEC to do what they need to do,” he said.
The UAE, a founding member of OPEC, announced it would exit the group from May 1, a move that has raised questions about the future cohesion of the producer alliance and its ability to manage global supply.
The UAE since the start of the US- Israel attack on Iran has suffered some significant attacks The exit according to Bond gives the UAE greater operational flexibility in a changing energy landscape.
“Yeah, I believe that to be the case. I mean, the point simply is that the UAE is, I would suggest, preparing for a world after the Iran war where oil demand is in decline, and OPEC’s power to maintain control and discipline will consequently be weaker.”
The decision to withdraw comes at a time of heightened tension in global energy markets, with disruptions linked to conflict involving Iran and constrained shipping through the Strait of Hormuz, a critical route for global crude flows.
Bond said the departure could weaken the broader influence of the oil producers’ group. “Well, it clearly is going to weaken the cartel, and it will be very interesting. Again, it’s a clever time to do this, because it will take a long way away from stability, because of the enforced reduction of supply.”
He added that OPEC’s long-term pricing power may come under pressure if demand continues to soften.“And we’ll have to see if it is able to continue to maintain discipline and elevated prices.” The decision also points to political reactions in consumer economies, including the United States, where President Donald Trump has previously criticised OPEC for high prices.
Bond suggested the UAE’s exit could prompt wider reassessment among other producers within OPEC. “Certainly people will be questioning their position now, because of course the UAE is a founding member, a major foundation stone for OPEC, and people will be asking themselves why have they done it and what world are they expecting when normality returns.”
Bond added that while Gulf tensions may have accelerated the decision, the broader trajectory was already in motion. “I’m not privy to the internal decision-making politics of the UAE, but clearly the moment has been brought on by the crisis in the Gulf and the chaos that’s been caused.”
