OPEC: Order within Region in Flux over UAE’s Withdrawal

Editorial

13:59 JST, May 2, 2026

The UAE withdrew from the Organization of the Petroleum Exporting Countries (OPEC) on Friday, putting an end to its about 60-year membership with the organization.

OPEC, which has served as a unifying force among Persian Gulf nations, has reached a major turning point. There is a high likelihood that order in the Middle East will become more fluid. Japan needs to formulate a new strategy to ensure a stable supply of crude oil.

OPEC was established in 1960 by five countries — Saudi Arabia, Iran, Iraq, Kuwait and Venezuela. It is an international cartel of oil-producing nations that has the aim of maintaining crude oil prices. The UAE joined in 1967.

The organization has long boasted of having strong control over pricing, notably raising crude oil prices in the wake of the 1973 Yom Kippur War, which triggered the first oil crisis. Although its share of the global market has fallen to about 30%, its production volume in 2025 reached 28 million barrels per day.

Conflict with Saudi Arabia is behind the UAE’s withdrawal. While Saudi Arabia has placed importance on keeping crude oil prices high and led a coordinated reduction in production, the UAE — home to the international financial hub of Dubai — has pursued economic growth through increased production.

The UAE’s withdrawal is shocking not only because the country ranked fourth in OPEC in terms of production volume, but also because it has the second largest surplus production capacity after Saudi Arabia and had been a core player when OPEC exercised pricing power. A decline in OPEC’s influence over the market is likely inevitable.

With the Strait of Hormuz effectively closed, resolving its current supply constraints is difficult, but the UAE is expected to eventually move toward increased production. There may be concerns that this would cause instability in the crude oil market, with prices fluctuating wildly and other consequences.

OPEC should continue to focus on market stability so that both oil-producing and oil-consuming nations can develop together.

The UAE’s withdrawal was also significantly influenced by the U.S. attacks on Iran. Iran’s largest attacks were launched at the UAE, citing the presence of U.S. military facilities. The stark contrast in stance with Saudi Arabia, which has been relatively tolerant of Iran, has become clear, creating a rift among Persian Gulf nations.

The instability caused by the wavering of OPEC, which has long held together the Middle East with its complex web of interests, is likely to persist for the long term. Japan should formulate a crude oil procurement strategy that takes the new Middle East situation into account.

First and foremost, Japan should strengthen its cooperation with the UAE, its largest crude oil supplier, which accounts for over 40% of Japan’s crude oil imports. Japan has a long history of good relations with the UAE. There is significant room for Japan to cooperate with the country in various economic sectors and build a mutually beneficial relationship.

Japan is dependent on the Middle East for more than 90% of its crude oil. It is also essential for the country to diversify its sources of crude oil to countries such as the United States.

(From The Yomiuri Shimbun, May 2, 2026)