Minus One "Volunteer": Seven OPEC+ Countries Held First Meeting Without UAE

**MOSCOW, May 3 - PRIME.** Seven OPEC+ countries with voluntary oil production restrictions (Russia, Saudi Arabia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman) held their first meeting after the UAE's exit from the agreement, during which they approved an increase in the maximum allowed production level by 188,000 barrels per day in June. According to experts surveyed by RIA Novosti, the "seven's" commitment to an unchanged strategy, despite the energy crisis stemming from the situation in the Middle East and the loss of one of the participants, is linked to their desire to maintain their share in the global oil market at the most opportune time. The opening of the Strait of Hormuz will allow OPEC+ countries from the Persian Gulf to increase production without significantly impacting prices. "The opening of the Strait of Hormuz will likely trigger a psychological market reaction. If you then announce that you've agreed on quota increases, this will further negatively impact prices. If you had been increasing quotas each month, you can argue that 'we will increase production because the quotas were already high.' This approach aims to mitigate the market's reaction," said Igor Yushkov, lead analyst at the National Energy Security Fund.

Complete Energy Crisis

The active phase of the conflict between the U.S. and Israel with Iran, which started in late February, led to the closure of the Strait of Hormuz, a key route for energy resource supplies from Persian Gulf countries. As a result, oil production in the region began to decline. According to OPEC's April report, oil production in Iraq fell 2.6 times in March to 1.625 million barrels per day, while Kuwait's output dropped 2.1 times to 1.213 million barrels. The UAE reduced production by 1.8 times over the month to 1.892 million barrels per day. Saudi Arabia cut its production by 23% to 7.799 million barrels. The global oil market is losing 10-12 million barrels daily due to the Middle Eastern conflict, with approximately 600 million barrels already under-delivered, stated Russian Deputy Prime Minister Alexander Novak. He has repeatedly pointed out that the world is currently experiencing the largest energy crisis in 40 years, and restoring oil supplies will take at least several months.

The UAE Exits the Agreement

The Emirati state news agency WAM reported on Tuesday that the UAE will exit OPEC and OPEC+ effective May 1. This decision is directly linked to the effective closure of the Strait of Hormuz and was made considering the investments made to increase oil and gas production and in petrochemicals in the UAE, stated the Minister of Energy and Infrastructure, Suhail Al-Mazrouei. According to a source from one of the OPEC delegations speaking to RIA Novosti, the organization was unaware of the country's intentions. The UAE also did not inform Russia of its decision, as stated by Russian President's Press Secretary Dmitry Peskov. Now, essentially, the UAE is no longer bound by any production constraints previously adhered to under the agreement. Kpler's head of OPEC+ analysis, Amena Bakr, estimated that the UAE could ramp up production to 4-4.2 million barrels per day within six months. The Abu Dhabi state-owned oil company ADNOC has already announced its intention to attract up to 200 billion dirhams (about $55 billion) for development projects by 2028. According to Igbal Guliyev, Dean of the Financial Economics Faculty at MGIMO and Doctor of Economic Sciences, the UAE's exit from OPEC and OPEC+ is a significant political gesture, but its immediate effect is limited, as the region is already living in a state of heightened turbulence. "In the long run, this move could ignite competition for market shares and undermine the previous model of agreed restrictions. However, for now, the situation is dominated by the Strait of Hormuz and how much risk investors are willing to bear," he told RIA Novosti.

Stability is a Sign of Mastery

Despite the ongoing situations, OPEC+ remains committed to its strategy. The increase in the maximum production level in June is comparable to the May increase of 206,000 barrels per day, with the UAE's share excluded due to its exit from OPEC and OPEC+ effective May 1. Aside from the established quotas for all agreement participants, the seven OPEC+ countries have additional restrictions. The UAE, which has exited OPEC and OPEC+, previously participated in these restrictions as well. From April 2025, participants will gradually abandon their limits, thus meeting monthly to discuss plans for the upcoming month. In September 2025, eight countries, including the UAE, prematurely concluded their exit from voluntary production limitations of 2.2 million barrels per day, and in October began the gradual withdrawal from further production cuts of an additional 1.65 million barrels. According to Yushkov, OPEC+'s strategy over the past two years has been focused on reclaiming market share that the alliance may have lost while reducing oil production. "Other countries outside of OPEC+ took advantage of this situation. The U.S., Guyana, Brazil, and Canada have all increased production, capturing our market shares. Currently, we see that OPEC+ has decided that there is a need to fight for market share," the expert noted. Independent energy expert Kirill Rodionov highlighted that the quota of the seven countries by the end of June will exceed March 2025 levels by 2.94 million barrels per day when the exit from restrictions began. According to him, the current geopolitical conditions allow OPEC+ to increase quotas without the risk of a sharp drop in oil prices. Rodionov did not rule out the possibility that if the acute phase of the U.S.-Iran conflict is not resolved by May, the alliance may decide to implement a similar increase in the maximum production level for July. “The price of Brent crude oil is near the $110 per barrel mark, creating a favorable backdrop for quota increases. The crucial factor for the market remains the crisis surrounding the Strait of Hormuz, while quotas are on the periphery of attention,” commented Sergey Tereshkin, General Director of Open Oil Market. Experts remind that actual growth in production is not expected at this time, as countries in the Persian Gulf are far behind their OPEC+ quotas due to the conflict. Thus, the "eight" countries (including the UAE) produced 6.877 million barrels less than the target level in March, which accounts for previously allowed overproduction compensations, according to RIA Novosti calculations based on OPEC data. "But when the Strait of Hormuz is cleared, which is pertinent for Middle Eastern countries, they can instantly ramp up production, as they have accumulated additional production quotas during these months," added Yushkov. Source: Prime