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In an article featured in the Financial Times, Yousef Al Otaiba, the United Arab Emirates ambassador to the United States, discussed the motivations behind the UAE’s decision to exit the Organization of the Petroleum Exporting Countries (OPEC) and its extended OPEC+ alliance.
In his piece, titled *OPEC Exit Reflects UAE’s Diversified Future*, Al Otaiba reflected on his personal connection to OPEC meetings, dating back decades. He recalled his first experience attending such a meeting as a teenager, stating, “Forty years ago, I attended my first OPEC gathering. It was my first time wearing a suit and tie, and I was just thirteen years old. Neither I nor my father, Manea Al Otaiba, then serving as the UAE’s Minister of Petroleum and Mineral Resources, were particularly happy. It was 1986, during a year when oil prices had dropped below $10 per barrel. My father had spent considerable effort lobbying fellow OPEC members to raise production quotas and stabilize global prices. Headlines from the August conference in Geneva echoed those pressing concerns.”
He shared that his father had told reporters that day, “We still have a long way to go. I’m not overly optimistic.” His skepticism proved justified, as the meeting concluded without reaching a resolution. However, OPEC remained steadfast, and the UAE ultimately rose to become the third-largest oil producer within the organization.
A Decision Rooted in Vision, Beyond Quotas
Last week, the United Arab Emirates made a pivotal move by announcing its withdrawal after nearly six decades of membership. This choice, however, extends well beyond the realm of production quotas or challenges posed by wartime disruptions.
This decision signifies profound shifts in global energy dynamics, transformative changes in the international economy, and a well-defined vision for the UAE’s evolving role and future trajectory.
In his commentary, Al Otaiba observed that OPEC was originally created for nations whose economies were heavily reliant on oil, a category the UAE no longer identifies with. Reflecting on history, he explained that the UAE had joined OPEC as Abu Dhabi, even before achieving full independence. At that time, the nation’s economy was overwhelmingly dependent on oil revenues.
Al Otaiba elaborated that OPEC’s mechanisms, such as collective production management, unified discipline, and coordinated pricing, were instrumental for a nascent state. These frameworks offered the UAE crucial stability, global influence, and invaluable experience during its early years as a newly independent country. However, he underscored that the UAE of today is vastly different from what it once was.
Currently, less than a quarter of the UAE’s GDP is tied to energy. The country’s most dynamic and rapidly expanding industries now encompass aviation, logistics, advanced manufacturing, artificial intelligence, tourism, and life sciences. This marks a striking transformation that reflects evolving priorities and strategic ambitions for the future.
35 Comprehensive Economic Partnership Agreements
He highlighted that over the past four years, they have signed 35 Comprehensive Economic Partnership Agreements, 15 of which are already active with countries like India, South Korea, Indonesia, Ukraine, Israel, Kenya, Malaysia, Vietnam, and Jordan, among others. This has significantly broadened market access to billions of people. He also mentioned ongoing efforts to finalize a bilateral trade agreement with the European Union and outlined their commitment to a $1.4 trillion investment and technology partnership with the United States.
He pointed out that such progress does not align with the image of a nation solely focused on managing oil supplies within a collective framework.
Al Otaiba reflected on the past year as a wake-up call for governments and households worldwide regarding energy insecurity. He explained how regional instability has disrupted supply chains, driven energy prices to record levels, and imposed heavy burdens on consumers, farmers, and businesses globally from Des Moines to Delhi. The key takeaway, he stressed, is the urgent need for more reliable and affordable energy solutions, alongside producers capable of consistently meeting demand. He underscored that the UAE’s priority lies in fostering a stable regional environment rather than perpetuating instability. This principle, he said, guides both the country’s energy and foreign policies.
He explained further on the UAE’s energy capabilities, stating their significant surplus and the robust infrastructure necessary for scaling up distribution. Plans are underway for massive investments worth tens of billions of dollars in new pipelines, enhanced port facilities, and improved logistics to ensure energy availability for global markets, irrespective of external uncertainties.
Looking ahead, he stated their ambition to boost production capacity to 5 million barrels per day by 2027. However, he noted that within the collective production framework currently in place, much of this capacity remains unused. Exiting OPEC, he added, would not simply be a commercial decision but rather a broader responsibility.
Global Energy Security
Al Otaiba underscored the UAE’s vital role in bolstering global energy security and fostering international economic stability, particularly during a period when both are under considerable threat. He stressed the nation’s unwavering commitment to fulfilling this responsibility.
He highlighted that the UAE is not merely increasing production to accumulate revenue but also channeling these earnings into transformative infrastructure projects across the developing world. Over the past two decades, Masdar, the UAE’s renewable energy company, has spearheaded sustainable initiatives in 40 countries, including the United States. The Barakah Nuclear Power Plant, recognized as the first nuclear facility in the Arab world, is now operational and delivering essential clean energy. Meanwhile, ADNOC has pledged tens of billions of dollars toward advancing low-carbon energy solutions through its new global investment arm, XRG.
He noted that the UAE’s approach is strategic and balanced: utilizing revenues from traditional oil to finance the transition to sustainable energy. Despite these progressive efforts, he criticized Iran’s actions, highlighting its continued membership in OPEC while undermining the organization’s mission to stabilize oil markets and provide efficient, reliable energy supplies to consumers. He pointed out that Iran, in violation of ceasefire agreements and international law, resumed attacks on oil tankers and critical energy infrastructure in the Gulf just days ago.
Reflecting on his family’s legacy, Al Otaiba shared a personal account, mentioning a conversation with his father, a former six-time OPEC president. While he expected his father to have mixed emotions about the UAE’s decision to move beyond OPEC, he was reminded of the broader vision that has always guided their country. According to his father, oil revenues were never the ultimate goal but rather a stepping stone toward building a diversified economy, a knowledge-driven society, and a forward-looking nation prepared to thrive regardless of how global conditions evolve.
