Petrol prices in the UAE will drop in January, in line with global oil prices, authorities said on Wednesday.
How much will fuel cost in January?
Super 98: Dh2.53, down 6.3 per cent from Dh2.70 in December
Special 95: Dh2.42, down 6.2 per cent from Dh2.58 in December
Diesel: Dh2.55, down 10.5 per cent from Dh2.85 in December
E-Plus 91: Dh2.34, down 6.8 per cent from Dh2.51 in December
The UAE deregulated fuel prices in 2015 and rates are now tied to those in the global oil market, which has experienced volatility since hitting a peak in 2022.
Among factors that have affected oil markets are the Russia-Ukraine war, conflicts in parts of the Middle East, global economic uncertainty, stock market concerns and interest rate speculation.
Brent crude is heading into the new year under sustained pressure, with prices at risk of slipping below $60 per barrel after posting their steepest annual decline since 2020.
Brent, the benchmark for two thirds of the world's oil, and West Texas Intermediate, the gauge that tracks US crude, were nearly flat at $61.30 and $57.91 per barrel, respectively, as of 11.39am UAE time on Wednesday.
Oil prices are all but set for their steepest annual decline since 2020 amid oversupply concerns as Opec+ boosts production amid plans to regain market share.
Oil is still on track for a fifth monthly drop in December, which would be the longest losing streak in more than two years. Prices have been dragged lower by concerns about a global glut following supply increases from Opec+ members as well as countries outside the group.
Geopolitical tensions, including the US military strikes on Opec member Nigeria, a major oil producer, and escalation between the US and Opec member Venezuela have helped to stem the slump in recent weeks.
Meanwhile, global demand for oil is expected to continue rising through the next quarter-century, poised to reach 105 million barrels per day by 2035 and hit 113 million bpd by 2050, the International Energy Agency said in its annual World Energy Outlook report in November.
2026 performance
Oil's weak performance is expected to extend into 2026, as supply growth continues to outpace demand. This is set to heighten fiscal pressure on oil-dependent Gulf producers and sharpen scrutiny of Opec+’s strategy of restoring output to regain market share, even as global consumption continues to expand.
Analysts say the oil market is entering a period of structural imbalance, with production expected to grow at roughly three times the pace of demand despite steady consumption gains.
Global oil demand is forecast to rise by about 900,000 bpd in 2025 to 105.5 million bpd, followed by a similar increase in 2026 and stronger growth in 2027. Supply, however, is projected to expand at three times that rate in 2025 and 2026, driven by higher output from Opec+ and non-Opec producers.
