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Frank Chen

Mia Nurmamat

China may gain from the United Arab Emirates (UAE) withdrawing from the Organisation of Petroleum Exporting Countries (Opec), benefiting from additional supply as global oil markets face growing strain three months into the US-Israeli war in Iran, analysts said.
The UAE – Opec’s third-largest producer, accounting for about 12 per cent of its total output – will formally leave the bloc on May 1. UAE Energy Minister Suhail Mohamed al-Mazrouei told CNBC that it was the “right time” to exit, adding that supply shortfalls demanded more flexibility than Opec’s collective decision-making allowed.
For major importers such as China, that added flexibility could boost supply and push prices down.
“For a buyer, any potential supply increase is positive as it means pressure on prices. I would expect China to increase purchases from the UAE,” said Muyu Xu, a senior crude oil analyst at Kpler, a trade and logistics consultancy.
Xu said the UAE’s exit could deepen energy ties between the two countries. In 2025, China imported 692,000 barrels per day from the UAE, out of total daily exports of 3.17 million barrels, accounting for 6 per cent of China’s seaborne imports, according to Kpler.
Other analysts agreed that additional supply could become more readily available beyond the constraints imposed by Opec.
“With the UAE being more flexible to increase production, China may be able to tap the former’s oil quickly if they are in favour of buying in the spot market,” said June Goh, a senior oil market analyst at Sparta Commodities.


China, the world’s second-largest economy, is heavily dependent on oil imports and has sought to diversify its supply sources in recent years. It imports about 70 per cent of its needs.
But analysts cautioned that the immediate impact of the UAE’s decision might remain limited by disruptions in the Strait of Hormuz, a trade chokepoint that handles about 20 per cent of global oil and gas flows.
“I don’t see any immediate impact, as whether a country joins or leaves Opec is irrelevant to the current disruption of the Strait of Hormuz,” said Alfredo Montufar-Helu, managing director at Ankura China Advisors.
“Moreover, not only are there few options to reroute oil exports from the Gulf, but their volume capacity is nowhere near the level that used to flow through the strait,” Montufar-Helu said.
Shipping disruptions have pushed up prices, with Brent crude rising to US$114 a barrel on Wednesday afternoon. But over the long term, Xu of Kpler said she expects prices to drop considerably.
“We could see both Opec and non-Opec producers prioritising higher output to offset supply losses soon after the conflict,” Xu said. “Given the UAE’s sizeable capacity, competition is likely to intensify, with a risk – albeit in a more extreme scenario – of a price war.”
Beyond oil markets, some analysts believe the move could create scope for closer financial ties between China and the UAE and boost yuan internationalisation, albeit modestly.
“The UAE could see greater flexibility to experiment with selective yuan activities, if China provides sufficient incentives, though no major change to the petrodollar system is expected,” said Gary Ng, senior economist for the Asia-Pacific at Natixis.
Opec was founded in 1960 to coordinate production, stabilise prices and counter the influence of Western oil majors. The UAE joined in 1967.


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Beijing may have access to increased supply – though Strait of Hormuz disruption remains a serious constraint, analysts say


Beijing may have access to increased supply – though Strait of Hormuz disruption remains a serious constraint, analysts say.


Why China may benefit from the UAE’s Opec withdrawal amid Iran war oil crisis

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Beijing may have access to increased supply – though Strait of Hormuz disruption remains a serious constraint, analysts say

Beijing may have access to increased supply – though Strait of Hormuz disruption remains a serious constraint, analysts say