UAE Minister of Energy Suhail Mohamed Al Mazrouei announced on Tuesday that the country would exit OPEC and OPEC+ , dealing a heavy blow to the oil-exporting groups and their de facto leader, Saudi Arabia , at a time when the Iran war has caused a historic energy shock and unsettled the global economy. Analysts noted that UAE and Saudi Arabia are the only members with meaningful spare capacity, a key lever for influencing market prices. One analyst from RYSTAD said the UAE's withdrawal marks a significant shift for the organization, and that while near-term effects may be muted, the longer-term implication is a structurally weaker OPEC. The analyst added that the UAE would have both the incentive and the ability to increase production outside the group, raising questions about the sustainability of Saudi Arabia's role as the market's central stabiliser and pointing to a potentially more volatile oil market as OPEC's capacity to smooth supply imbalances diminishes. Another expert from ICIS remarked that the UAE has been in disagreement with general OPEC policy for quite some time, so the move is not a surprise but will certainly have a significant impact in the long term. A former Gazprom Neft executive at the Carnegie Russia Eurasia Center added that the UAE has been planning to grow oil production by up to 30%, and that doing so within the limitations of OPEC and OPEC+ would be difficult. He noted that the announcement comes at a time when oil prices are high and there are genuine shortages because of Hormuz closure. After Hormuz reopens, there will be elevated demand as countries will be replenishing reserves that were drawn down since February, so prices will stay high. Without the UAE, the analyst from the Carnegie centre warned that OPEC will be much weaker, as other major producers, Iran and Iraq, did not maintain any substantial spare capacity. It was mostly done by UAE and Saudi Arabia. Looking ahead, the market may see a gradual shift toward a more fragmented supply structure, with the UAE's increased production capacity potentially offsetting some of the supply shortfalls caused by the Hormuz disruptions. However, the long-term stability of the oil market will depend on how quickly OPEC+ can adapt to the new dynamics and whether other members can step up to fill the gap left by the UAE's exit.