The Organisation of the Petroleum Exporting Countries and its allies, known as OPEC+, is facing a potentially existential crisis, and the source of the trouble is one of its most powerful members: the United Arab Emirates. Despite public displays of unity, evidence suggests the UAE is systematically exceeding its production quotas, challenging the authority of the cartel and its de facto leader, Saudi Arabia.
The Numbers Tell a Troubling Story
On May 31, 2025, OPEC+ announced it would increase crude output by 411,000 barrels per day (b/d) in July. This marked the third consecutive monthly hike, a drastic acceleration from the 122,000 b/d monthly increases planned just a year prior. While the group cites "healthy fundamentals" for the move, many analysts see a scramble for market share and an attempt to manage internal dissent.
At the heart of the dissent is the UAE. Officially, the country reports production of 2.9 million b/d, perfectly aligning with its OPEC quota. However, this figure is widely disputed. Tanker-tracking data indicates the UAE's crude exports alone reach 2.8 million b/d, not accounting for domestic refining or stock additions. More damningly, the International Energy Agency estimated the UAE's output at nearly 3.3 million b/d in April 2025. Some analysts with contacts among foreign producers in the UAE suggest the real number could be as high as 3.4 million b/d.
Why Can't OPEC Rein In the UAE?
Enforcing discipline has always been OPEC's greatest challenge. While Iraq has slightly trimmed overproduction and Kazakhstan remains troublesome due to its reliance on international firms, the UAE presents a unique problem. The country has long been frustrated with its quota, arguing it fails to reflect its substantial spare production capacity.
This frustration has boiled over before. During the post-COVID demand rebound, clashes over quotas twice led the UAE to consider leaving OPEC entirely—a move that could have shattered the cartel. Saudi leaders, aware of this threat, now tread carefully. Publicly, relations have grown frostier, but Riyadh fears pushing Abu Dhabi too far. The economic stakes also differ: an economist at an Emirati bank notes the UAE needs oil at just $50 a barrel to balance its budget, while Saudi Arabia's lavish spending requires prices closer to $90.
A Cartel on the Brink
The underlying tension is set to worsen. The UAE is investing $62 billion to boost its production capacity to 5 million b/d by 2027, up from 3.6 million b/d in 2021. Its state oil company, Adnoc, claims it has nearly hit that target already. Yet, its OPEC quota has not kept pace. A promised comprehensive quota revision was recently postponed until 2027.
Analysts who speak to officials in both governments warn that an open clash between Saudi Arabia and the UAE is only a matter of time. If the cartel's largest and third-largest exporters descend into open conflict, the cooperative framework that has influenced global oil markets for 65 years could become unworkable. The UAE's actions are not just about extra barrels; they threaten the very foundation of OPEC+.
