– Signals a New world Energy Order and the return of days of glut – Experts
By Uche Chris
What happened on Tuesday April 29, 2026 with the exit of United Arab Emirates, the third largest producer, from the Organization of the Petroleum Exporting Countries (OPEC) was sudden and will impact countries, such as Nigeria, in very major dimensions. While attention was focused on the raging war between U.S-Iran, this action must have been anticipated by objective observers for two reasons.
Announcing the new policy shift, its Minister of Energy and Infrastructure, Suhail Mohamed Al Mazrouei, said it was in national interest to take advantage of its huge investments in the sector and to maximize its production. He admitted not informing Saudi Arabia, the leader of the group, in making the decision.
UAE has borne the brunt of the US-Iran war more than other Gulf state. Iran had fired over 400 ballistic missiles and 1000 drones against it. But for Israel’s Iron Dome, deployed and man by the Israelis, when the firing started, the country would have been completely destroyed.
Sudden But Inevitable
This exit marks a drastic policy realignment: it was obvious the UAE may never be in the same organization with Iran after such a malevolent behavior against it. For years, experts have advised Nigeria to leave OPEC without success. Indonesia, once the sixth largest produced, left in 1986.
The second ancillary factor was the Abraham Accord between UAE and Israel, which buttresses the saying that the “friend of my enemy is my enemy.” Iran’s ultimate goal is the destruction of Israel and, perhaps, U.S, and here was an Arab country, embracing it. Its significance is greater than the Camp David Accord between Israel and Egypt.
A third and very critical factor is that President Donald Trump is fossil fuel proponent, which makes him anti-green energy. Europe and the rest of the world fell into the well orchestrated campaign on global warming and the push to change to green energy. Europe is suffering its embrace of the policy.
Opposing Green Energy
Today the cost of energy in U.S is half of that of Europe and it has cost consequences in both product and lifestyle, especially compared with Chinese products produced with fuel. Trump made it clear at the last UNGA when he told Europe to change course or perish. Green energy has its limitations: it is too expensive and not a sustainable source of energy for heavy industries, such as Artificial intelligence, AI production.
Then, enters OPEC, the oil cartel that has controlled output and prices by the Arabs of crude to the chagrin and frustration of the U.S and EU. Though, the largest producer in the world, the U.S, until Trump’s first term, did not explore or export its oil. It was the largest importer of crude, over 10 mbpd, and left its domestic production as reserves. This kept prices up as the OPEC+ determined the price through output manipulation.
The cartel, founded in 1960 by five countries in Baghdad, Iraq, was a quiet revolt against the “Seven Sisters,” the Western multinational giants that then dictated the terms of global oil. For six decades, the cartel has been the world’s most potent instrument of managed scarcity. Other members were Saudi Arabia, UAE, Iran, Kuwait, and Venezuela.
Crude Power
The “bad boys” or radicals in the cartel, who wanted an equitable prices from the Seven Sisters were Iran, Iraq, Libya and Venezuela. Between 1960 and 1973, the cartel was only able to move price from $1.8 to $4. But the 1973 embargo moved the price to $14 practically grounding the West.
It was a new found power that flooded the cartel countries, such as Nigeria, with unimaginable petrodollar, which became a source of conflict and mutual antagonism between the cartel and consumer nations, such as U.S. It was the beginning of the quest for alternative energy, especially green energy, spurred and motivated by climate change campaigners.
However, China and India stood against the anti-fossil fuel proponents because they needed to develop their industry first unlike Europe, which is entering post industry era. But China was also pragmatic: while relying on crude oil and coal, it was also develop non fossil fuel vehicles, such as electric cars (EVS), which it is now world leader.
Iran’s Connection
President Trump understood its implications and the foolishness of Europe’s ban on fuel vehicles by 2030, which would make the West dependent on China, as U.S production led by Elon Musk’s Tesla is inadequate for such a global demand. Sadly, previously Democratic previous U.S presidents signed in on it. Most people don’t understand the fact that Trump foresaw the strategic policies now being executed before becoming president. He opposed green energy long before now. As he did Iran possession of the nuke.
With Iran military capability and infrastructure completely decimated, oil will play a major role in its recovery; so keeping its price low for a sustained long period of time would deal a deadly blow to its recovery and enssure it doesn’t become a threat sooner after.
In fact, the UAE action is to continue the war by other means. Iran is the second largest producer with 3.6 mbpd, while Saudi Arabia produces 7.3 mbpd.
With the United Arab Emirates (UAE) formally exiting the body, the illusion of a monolithic “OPEC+” has evaporated, replaced by a cold, new reality: the cartel is no longer the arbiter of global energy prices. Subsequently, countries, such as, Qatar, Kuwait, Khazastan, which has been pushing for more quota, and also allied to the U.S, may follow. This will leave mainly Saudi and some fringe members, like Nigeria.
Death To Cartel
Given this scenario, U.S would control over 25-30 percent of global crude supply and North East oil by Norway and UK may return following Trump’s rebuke and the changing attitude in Europe toward it.
Oil entered the Arab-Israel conflict in 1973 when the Arab countries imposed export embargo on the West for supporting Israel in the war. With the U.S producing about 15 mbpd, controls Venezuela one mbpd, Khazastan 2 mbpd, and UAE’s possible 5 mbpd, the U.S would control about 23 mbpd of crude out of the global production 90 mbpd, and OPEC’s 38 mbpd.
The cartel would be effectively dead and the crude oil market diversified that a few countries can’t determine price again. Also be minded that China is a big producer.
While most analysts focus on internal reasons for the exit because mainstream media would not look beyond the ordinary to deprive any credit that may go to President Trump, the belief is that the exit is primarily a product of a mismatch of ambition and ideology. There was obviously a policy skirmish between Saudi Arabia and UAE over quota, it was not the reason; it only provided a pretext.
Not Ovver Quota Hike
While Abu Dhabi poured billions into capacity expansion, aiming for 5mbpd, it was held back by a Saudi-led mandate that prioritized price manipulation over volume growth. As oil prices crossed the $100-per-barrel threshold, the opportunity cost became untenable. The UAE’s departure is not merely a bureaucratic dispute; it is a declaration of economic independence.
By decoupling these key producers from the OPEC quota system, the U.S. creates a counter-cartel mechanism, effectively neutralizing the market power of the remaining members. In 2025, OPEC grossed $450 billion in income, with the UAE alone claiming $77 billion.
For Iran, the consequences are existential. Already devastated by war and isolated by sanctions, Tehran relied on OPEC’s tight-fisted production quotas to keep prices artificially high, masking its own economic decay. Now, as the UAE, a nation that has borne the brunt of Iranian-backed provocations and is a cornerstone of the Abraham Accord, steps outside the cartel, Iran loses its seat at the table of influence.
Without the ability to manipulate prices in concert with its rivals, the Islamic Republic faces a catastrophic revenue shortfall. Iran is not just losing a market share; it is losing its leverage.
Nigeria In The Mix
The periphery is equally exposed. Nations like Nigeria, whose economies have long tethered their survival to OPEC’s managed stability, will find themselves drifting in a volatile, unanchored market. Unable in the past decades to meet its quota of 2.8 mbpd, and at present level of 1.4 mbpd without condensate, the evil days have indeed come.
The picture is very grim for the country. With low output and mounting debt profile, oil theft, and decaying social infrastructure such as education, health, insecurity , which has become the new drain pipe, and transportation, the expectation of low oil price in the medium and long term is apocalyptic for the country. Having postponed diversification perennially, Nigeria have finally shot itself in the foot.
The prospect of an oil prolonged glut may be a death sentence on the economy. When the cartel’s final backbone—potentially involving Qatar’s full pivot away from its legacy ties—is broken, the era of the “swing producer” dies.
In war, all is fair. The UAE’s exit is the culmination of years of security tensions and the high cost of proximity to Western influence. The cartel was designed to manage a world where producers controlled the price. In this new geopolitical cycle, the market will reclaim that power. For Iran, and for the vestiges of the old OPEC, the message is clear: the era of the energy monopoly is over.
Experts Fear For Nigeria
Prof. Wumi Iledare, a professor of Petroleum Economics and Policy Research at Louisiana State University and also the Director, Energy Information Division, Center for Energy Studies (CES), said it is bad omen.
“The current situation around a possible UAE exit from OPEC points to a deeper structural issue: growing tension between expanded production capacity and quota constraints within OPEC+.
Countries that have invested heavily in capacity, like the UAE, face a clear incentive to prioritise volume monetisation over collective price management. If this trend strengthens, OPEC’s ability to enforce discipline may gradually weaken, not abruptly, but through rising non-compliance.
For Nigeria, the risk is twofold. First, potential downward pressure on oil prices in a less coordinated market. Second, and more critical, our domestic underperformance, production shortfalls, high costs, and leakages limit our ability to benefit even when prices are favourable.
The policy takeaway is straightforward: Nigeria must prepare for a less reliable OPEC price umbrella. This means improving production efficiency and security, reducing unit costs, adopting more conservative fiscal assumptions, and accelerating gas-led diversification
Dr. Muda Yusuf, former Director General, Lagos Chamber of Commerce and Industry (LCCI) and Founder/CEO, Centre for the Promotion of Private Enterprise (CPPE)
“I think the exit of the UAE from OPEC is likely to be a disadvantage for Nigeria. That’s the way I am looking at it.
The objective of OPEC is to ensure that we have a good price so that we can get good revenue. Now that a major member has left, their capacity to wield that influence has diminished. That means the UAE is now free to sell as much crude as it wants, which may lead to a reduction in price.
We can have more quota, but the price may be lower. If prices are going down, OPEC can reduce supply. But now the organisation is weaker. So, the exit is likely to be more of a disadvantage than an advantage.
If the price is not strong enough because OPEC is weaker and output is still not there, that is a double tragedy for the country.
For Nigeria, what the government can do is to improve output so that even if prices are weak, we still have enough volume. Beyond that, we should depend less on crude oil and export more refined products”