Ecuador Signs Oil Deal with Abu Dhabi's ADNOC — Direct Sales, No Middlemen

Ecuador just made a deal that could reshape how it buys and sells oil — and it involves one of the biggest energy companies on the planet.

The Deal

During President Daniel Noboa's February 2026 visit to the United Arab Emirates, Ecuador's state oil company Petroecuador and the Abu Dhabi National Oil Company (ADNOC) signed a memorandum of understanding establishing a direct commercial relationship.

The agreement was signed by ADNOC CEO Sultan Al Jaber and Ecuador's Minister of Environment and Energy Inés Manzano.

What It Covers

The MOU establishes three key pillars:

1. Direct crude oil sales: Ecuador will sell crude directly to ADNOC, eliminating the intermediary traders who have historically brokered Ecuador's oil on international spot markets
2. Long-term contracts: ADNOC will provide medium and long-term supply contracts, reducing Ecuador's dependence on volatile spot pricing
3. Refined product imports: Ecuador can purchase diesel, gasoline, and other refined products directly from ADNOC's refineries

Why This Matters

Ecuador has long relied on intermediary trading firms to move its crude oil on global markets. These middlemen take a cut. By selling directly to a state-backed buyer like ADNOC, Ecuador captures more revenue per barrel.

On the import side, Ecuador is a net importer of refined fuels — the country produces crude but lacks sufficient refining capacity. Buying gasoline and diesel directly from ADNOC's refineries could lower procurement costs compared to purchasing through traders.

The ministry says the arrangement will "reduce spot market dependence, mitigate price volatility, and guarantee supply stability."

What We Don't Know

The MOU is a framework document, not a completed transaction. Key details remain undefined:

• Specific volumes (barrels per day)
• Pricing terms
• Implementation timeline
• Whether this replaces or supplements existing trading relationships

What This Means for Expats

• Fuel prices: If Ecuador can import refined products more cheaply, it could ease pressure on domestic fuel prices — or at least slow the rate of increases under the monthly price-band system
• Fiscal stability: More revenue per barrel of exported crude means more money in government coffers, which reduces the likelihood of austerity measures or new taxes
• Geopolitical context: This deal comes as Ecuador simultaneously navigates a trade war with Colombia (which suspended electricity exports) and courts closer ties with the U.S. (Trump summit). Diversifying energy partnerships makes strategic sense
• The subsidy question: Ecuador spends billions subsidizing fuel. Cheaper imports don't necessarily mean cheaper gas at the pump — the government may use savings to reduce the subsidy deficit instead

Sources: El Universo, ADNOC, Ministerio de Ambiente y Energía