UAE petrol prices will fall in July, the first drop in five months, as global crude oil benchmarks dip to pre-Iran war levels, easing supply concerns.
Prices at the pumps fell in January and February but have been rising since March as the conflict disrupted oil markets, especially as the Strait of Hormuz – normally the route for about a fifth of the world's energy exports – was effectively shut.
How much will fuel cost in July?
Super 98: Dh3.40, down nearly 14 per cent from Dh3.95 in June
Special 95: Dh3.29, down 14.1 per cent from from Dh3.83
E-Plus 91: Dh3.21, down 14.6 per cent from Dh3.76
Diesel: Dh3.60, down nearly 17 per cent from Dh4.33
Negotiations between the US and Iran, as well as between Israel and Lebanon, have progressed, which allowed more vessels to pass through the strait last week, despite American and Iranian strikes that tested the fragile truce.
At their peak during the conflict that began on February 28, Brent and West Texas Intermediate shot up by about 70 per cent.
Brent, the benchmark for two thirds of the world's oil, settled at $71.99 on Friday. It closed at $72.87 a barrel on February 27. WTI, the gauge that tracks US crude, ended the week at $69.23 per barrel. It closed at $67.02 on February 27.
The cost of fuel in the UAE has been tied to the global oil market since 2015, when deregulation was introduced.
Analysts had said that it may take time for pump prices to ease back to prewar levels, especially compared to the surge that resulted from the onset of the Russia-Ukraine war in 2022.
But the progress in peace negotiations and the reopening of the Strait of Hormuz have accelerated the decline of crude prices.
Adding to the easing of energy supplies globally are record exports by the US that have kept Asian and European markets better stocked, and the release of strategic reserves in Organisation for Economic Co-operation and Development countries.
In addition, Saudi Aramco resumed oil loading operations at its Ras Tanura terminal in the Gulf after an almost four-month halt, shipping data from LSEG showed. Oil exports from the UAE in early June, meanwhile, recovered to reach nearly 85 per cent of prewar levels, as the country used alternative shipping routes and pipelines, the International Energy Agency said last week.
