UAE Fuel Prices Set to Climb in February?
UAE Fuel Prices in February 2025: Will They Rise?
Recent Trends in Fuel Prices
UAE fuel prices reached their lowest point in a year in December 2024, a trend that continued into January as prices remained unchanged. In January 2025, the following prices were recorded:
a. Super 98: 2.61 dirhams/liter
b. Special 95: 2.50 dirhams/liter
c. E-Plus: 2.43 dirhams/liter
d. Diesel: 2.68 dirhams/liter
Although January prices remained stable, changes in the global oil market suggest an increase may be expected in February.
Why Might Fuel Prices Rise in February?
Global crude oil prices rose in January, potentially impacting UAE fuel prices as well. The average price of Brent crude oil was $77.55 per barrel in January, up from $73 in December, representing a significant increase of nearly 6%.
One main reason for this rise is geopolitical uncertainty:
1. The United States tightened sanctions on Russian oil, affecting major players like Gazprom Neft and Surgutneftegas, as well as 183 oil transporting ships.
2. This complicates Russian oil exports to China and India, the world's largest and third-largest oil importers.
3. This may lead to increased demand for oil from the Middle East, Africa, and the Americas, further driving up prices.
How Do Market Factors Impact UAE Fuel Prices?
Since 2015, the UAE has deregulated fuel prices, meaning they adjust at the end of each month in response to global market changes. Accordingly, February's fuel prices are expected to rise if Brent and WTI oil prices continue to climb.
By the end of January, the following price movements were observed:
a. Brent oil: $77.62 per barrel (+0.17%)
b. WTI oil: $73.99 per barrel (+0.3%)
c. Brent's peak in January: $81 per barrel (a four-month high)
These price movements suggest that retail fuel prices in the UAE may also increase in February, as the country's fuel price regulation follows global trends.
What Could Be the Impact of Price Increases?
For consumers: Transportation costs may rise, particularly affecting daily commuters.
For the transportation and logistics sector: Increased transportation costs may impact goods delivery and e-commerce.
For tourism: Higher fuel prices could affect taxi and car rental service rates.
What Does the Future Hold?
The official announcement of February fuel prices is expected at the end of January, and based on global oil market movements, there is a strong possibility of an increase after the stable prices of December-January. Geopolitical situations, American sanctions, and changes in oil demand will shape the coming months' fuel price trends in the UAE.
