The deterioration in the relationship between the United Arab Emirates and Saudi Arabia is at the heart of Abu Dhabi’s bombshell decision to leave OPEC.
The rivalry had been building up for years, but it was the side effect of the United States and Israel’s war against Iran that paved the way for this Tuesday’s announcement (28), according to sources heard by the Bloomberg. In practice, it was as if the “little brother” had decided that he no longer wanted to live in the shadow of his “older brother”.
And things don’t stop at OPEC. The UAE is also rethinking its participation in two regional organizations where Riyadh has a lot of influence, say these same sources, on condition of anonymity.
Although nothing has been decided, Abu Dhabi is considering “freezing” its seat in the Arab League, based in Cairo, and taking a similar attitude towards the Organization for Islamic Cooperation, based in Jeddah.
Also on the radar is the future of the Emirates within the Gulf Cooperation Council (GCC), a bloc of six Gulf countries. This Wednesday (29), Abu Dhabi made a point of saying that it remains committed to the group. But the diplomatic advisor to the president of the Emirates, Anwar Gargash, had already said at the beginning of the week that the GCC is experiencing “the weakest moment in history”.
An Emirati official stated that the country is reviewing the extent to which it makes sense to remain active in various multilateral organizations, but that, for now, it is not discussing formal exits.
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It is true that none of these three organizations have “hard power” — they do not send troops, they do not impose sanctions alone. But any rupture would make clear the extent of the UAE’s frustration with other Arab countries, especially with neighboring Saudi Arabia, given what they see as little solidarity in a scenario of military and economic challenges since the start of Israel’s war against Hamas in 2023.
Officially, leaving OPEC was sold as an economic decision, looking ahead to the country’s production needs. The UAE is able to produce much more than the cartel’s current quota allows and no longer wanted to have to “ask for a blessing” from the Saudis to use this additional capacity, according to a source familiar with the conversations in Abu Dhabi. Furthermore, with the Strait of Hormuz closed, global supply is so tight that no one in the government believes in a significant drop in prices in the short term.
Another point: in Abu Dhabi, the reading is that global demand for oil should start to fall due to the energy transition sooner than Riyadh imagines. The logic is simple — if the end of the cycle is closer, it is better to monetize reserves as soon as possible.
At the same time, the decision was the clearest message yet that the Emirates no longer want to hide their ambitions, nor limit themselves to the political and security umbrella of Saudi Arabia — which is the largest Arab economy and sees itself as the natural leader of the Muslim world.
“We are building a different economic model, and this requires a new political alignment and reconfiguration”, summarizes Nadim Koteich, a consultant who advises various bodies of the Emirati government.
Sheikh Mohammed bin Zayed’s (MBZ) move is the culmination of tension that has been ongoing for years with Saudi Crown Prince Mohammed bin Salman (MBS).
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The two countries — US allies and each owner of more than US$1 trillion in sovereign wealth fund assets — have been at odds in crises from Libya to Yemen and Sudan, often supporting opposing sides. In general terms, Riyadh accuses Abu Dhabi of encouraging separatist groups, while the UAE looks suspiciously at Saudi support for Islamist groups.
In the economic field, competition is also explicit: the Saudis want to transform Riyadh into a financial hub capable of competing with Dubai.
Blocks in formation
Despite the heavy climate, the UAE and Saudi Arabia remain aligned on several issues and should maintain the flow of trade — today, tens of billions of dollars in goods cross the border between the two annually. An Emirati official said an extraordinary GCC meeting in Jeddah, held close to the date of the OPEC exit announcement — and attended by the Emirati foreign minister — was a move “in the right direction”, without giving further details.
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The UAE’s departure from OPEC tends to consolidate two regional blocs that were already emerging. On one side, an axis led by Saudi Arabia, with Egypt, Pakistan and Türkiye. On the other, a configuration that brings together the Emirates, Israel and India.
In New Delhi, authorities interpreted the movement as a political gesture of rebellion, rather than a purely economic measure, with the potential to weaken the “Arab front”.
“The UAE does not want to follow an order led by Saudi Arabia or Turkey,” says Dania Thafer, executive director of the Gulf International Forum, a Washington-based think tank. “The country sees itself as an intermediate power, a counterweight to the others.”
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According to sources, the UAE began seriously planning its exit from OPEC around November last year. But the situation turned sour once and for all with the lack of balance in relation to the response to Iran’s missile attacks, in the context of the war with the USA and Israel.
Abu Dhabi even considered participating directly in attacks against Iran and defended, at the UN, the use of force to reopen the Strait of Hormuz — a critical route for oil and gas exports. The Saudis did not embark on this: they preferred to insist on diplomatic negotiations and discreet behind-the-scenes talks to end the conflict.
Israel Factor
The UAE’s rapprochement with Israel in military and intelligence cooperation also weighs in the balance, according to interlocutors. Many Arab countries still see Israel as an expansionist and destabilizing actor in the region, and hold it responsible for pressuring Washington to go to war with Iran.
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“There is a crack in the Gulf,” says Hasan Alhasan, senior fellow on Middle East policy at the International Institute for Strategic Studies. “The UAE does not have the full support of others when it comes to confronting Iran.”
Even so, the Emirates did not enter the war directly — today under a fragile ceasefire — despite the damage caused by Iranian attacks to Abu Dhabi’s energy infrastructure and the country’s image as a safe haven for tourists and investors. Iran has fired more missiles and drones at the UAE than at any other Gulf state, which has only heightened anger there.
In a recent conversation with European officials, MBZ expressed frustration with the neighbors’ collective response to Tehran’s attacks, according to sources with knowledge of the meeting. He pointed out the CCG’s internal divisions and classified the bloc as dysfunctional. In the same conversation, he said that he intends to reinforce cooperation with the USA and Israel.
Right time
For Gargash, MBZ’s advisor, the failure of the Iran “containment” strategy adopted by the Gulf countries, before the US and Israel military offensive, showed that institutions like the GCC “are not up to the task”.
The group, which brings together the Emirates, Saudi Arabia, Oman, Qatar, Bahrain and Kuwait, “is experiencing the weakest moment in history, considering the type of attack and the threat it poses to everyone,” said Gargash, a day before the announcement of OPEC’s withdrawal.
On the economic side, the decision also reflects the fact that the UAE has diversified its economy beyond oil and currently operates with fiscal surpluses. This gives you breathing room to go through periods of lower prices. The Saudi government ended 2023 in the red and is expected to continue with a deficit for a few years — unless the prolonged closure of Hormuz pushes oil prices even higher.
In Koteich’s view, the economic account for leaving OPEC was “closed”, and all that was missing was the “political timing”.
This timing came with the war against Iran and the impact of the closure of Hormuz on global energy supply, which took oil back to levels above US$100 per barrel.
“It’s not going to be something that radically changes the market — supply is already tight,” said UAE Energy Minister Suhail Al Mazrouei in an interview about OPEC’s exit.
© 2026 Bloomberg L.P.
