UAE will likely boost investments in oil and gas, potentially leading to a USD 40 bn windfall

The UAE is widely expected to accelerate investments in oil and gas after its exit from Opec and Opec+, according to several analyst notes following the announcement. Heavy investments across upstream capacity, drilling, processing, storage, and export infrastructure are likely, Arqaam Capital research head Jaap Meijer wrote on LinkedIn.

A newfound focus on Fujairah could be the next order of business given the “strategic value of pipeline and export capacity outside the Strait of Hormuz,” he explained.

Without Opec’s production quotas, the UAE might hit 6 mn bbl / d of capacity in the medium term if it accelerates investments in oil and gas, according to Meijer. A rise to 5 mn bbl / d is also “realistic” — given it’s been a target for 2027 for a few years now, up from a current capacity of around 4.6-4.9 mn bbl / d. A Barclays note picked up by Reuters also said the UAE is likely to accelerate oil supply as it works its way out of the current crisis.

A production hike to 5 mn bbl / d — up from about 3.4 mn bbl / d before the war — could add some USD 40 bn in annual gross oil revenue, Meijer wrote.

That’s a huge boon for the economy: A USD 40 bn boost would “support fiscal revenues, government-related entity capex, domestic liquidity, and real GDP growth,” he added.

As we reported earlier this week, the move to exit Opec+ comes at a critical time for the UAE’s economy — it was forecast to be the fastest-growing economy in the GCC this year, but is now expected by many to either stagnate or shrink in 2026 due to the impact of the war on the non-oil sector and oil market disruptions. Greater production flexibility may help offset slowdowns in sectors such as tourism, trade, and real estate, and maximize hydrocarbon revenues by capitalizing on market-disruption [windows] after the strait is fully open,” MENA economist Hamzeh Al Gaaod said.

Markets seem to already be pricing this in: The energy-heavy ADX rose 0.7% on the news yesterday, with Adnoc Drilling the most traded stock of the day, closing the trading day up 8.1% at AED 5.49. The firm could stand to be the biggest beneficiary from this exit, given higher capacity means “more wells, more rigs, more oilfield services intensity, and stronger long-term earnings visibility,” Meijer said.