The planned withdrawal of the United Arab Emirates from the Organization of the Petroleum Exporting Countries is raising concerns among energy analysts, who warn the move could weaken the group’s influence on global oil prices and hurt Nigeria’s revenue.
The UAE’s exit, set to take effect May 1, 2026, would remove about 1.2 billion barrels of annual crude production from OPEC’s coordinated supply system, marking one of the most significant changes to the alliance in decades.
While some observers see a potential opportunity for Nigeria to gain market share, experts say the development is more likely to increase price volatility and expose structural weaknesses in the country’s oil sector.
Data shows the UAE produced an average of 3.36 million barrels per day in 2025, accounting for roughly 12% of OPEC’s output, making it one of the group’s most consistent producers under the quota system.
Energy economist Wumi Iledare said the move reflects growing tensions within OPEC+, particularly among countries that have invested heavily in expanding production capacity.
He warned that as more producers prioritize higher output over coordinated supply cuts, OPEC’s ability to manage prices could weaken over time.
“For Nigeria, the risk is twofold,” Iledare said. “There could be downward pressure on oil prices, and at the same time, domestic challenges such as production shortfalls and high costs limit the country’s ability to benefit even when prices are favorable.”
Muda Yusuf, chief executive of the Centre for the Promotion of Private Enterprise, said the UAE’s exit is more likely to disadvantage Nigeria than benefit it.
“OPEC’s role is to stabilize prices. With a major member leaving, its influence is reduced,” Yusuf said. “The UAE can now increase supply independently, which may push prices down and weaken the group’s ability to control the market.”
He added that even if Nigeria receives a higher production quota, lower global prices could offset any gains.
Analysts also warn of a worst-case scenario in which Nigeria faces both declining oil prices and continued production challenges, including oil theft, pipeline vandalism and underinvestment.
Saul Kavonic, head of energy research at MST Financial, said the UAE’s departure could signal broader instability within OPEC+.
“This could mark the beginning of the end for OPEC as we know it,” he said, noting the group risks losing both capacity and internal discipline.
The UAE, which joined OPEC in 1967, said its decision followed a review of its long-term energy strategy and the need for greater flexibility in responding to market conditions.
In a statement, the country said it remains committed to playing a responsible role in global energy markets while expanding its production capacity.
The exit comes amid heightened geopolitical tensions in the Middle East, particularly around the Strait of Hormuz, a key global oil shipping route, adding to concerns about supply disruptions.
For Nigeria, Africa’s largest oil producer, the development underscores long-standing challenges in the sector. The country has struggled to meet production targets in recent years, and analysts say its ability to adapt to a more competitive and less coordinated global oil market will be critical.
Founded in 1960, OPEC has historically played a central role in stabilizing oil prices through coordinated production cuts, but internal divisions and shifting national priorities have increasingly tested the alliance’s cohesion.
