UAE Fuel Prices Expected To Drop In June

Fuel prices in the United Arab Emirates (UAE) are expected to drop in June as global oil prices were mostly lower in May compared to the previous month, a report said.

Last month, the global price of Brent crude oil ranged between $82 and $83 per barrel, with an average price of $83.35, which is lower compared to last month's average price, according to Khaleej Times.

The Fuel Price Committee in the UAE revises petrol prices on the last day of each month to match global oil prices in the next month, helping keep prices flexible with the deregulation policy.

Due to political tensions in the Middle East, petrol prices went up for the fourth month in a row in May. This month, Super 98 was sold at Dh3.34 per liter, Special 95 at Dh3.22 per liter and E-Plus at Dh3.15 per liter. These were considered the highest prices in the past seven months.

Vijay Valecha, Chief investment officer of Century Financial, explained that oil prices went up this year because of tensions in the Middle East and production cuts by the Organization of the Petroleum Exporting Countries (Opec) and its allies.

However, prices have dropped since early April due to plenty of oil supply from outside OPEC and weaker demand in Asia. "Opec+ is set to meet online on Sunday and expected to roll over its curbs into the second half of 2024," he added.

Ipek Ozkardeskaya, Senior analyst at Swissquote Bank, said, "China is also spending big to prop up its sputtering property market – a thing that brings further support to oil and commodity prices. Sentiment in oil is tilted to the upside, but there is one major risk to rebound above the $80pb level: a potentially waning reflation trade."

"If the central banks temper their rate cut plans into summer, demand outlook for oil could get hammered and the latter could limit recovery," Ozkardeskaya added.

Last month, Dubai Electricity and Water Authority (DEWA) announced that it plans to increase the number of green fast, and ultra-fast charging stations for Electric Vehicles (EVs) in the emirate this year. Fast and ultra-fast chargers can be found at petrol stations and the entrances and exits of Dubai.