Overview of Recent Trends

The UAE is likely to see an increase in petrol prices for August, as global oil prices have risen in July compared to the previous month. On average, oil prices hovered around $84 per barrel in July, up from $82.6 per barrel in June. Notably, Brent crude oil prices exceeded $85 per barrel during the first half of July, before dropping to $79.77 per barrel later in the month.

July Oil Market Highlights

Oil prices were particularly high at the beginning of July, with levels reaching above $87 per barrel. This surge was driven by a significant decline in US oil inventories and increased demand during the Northern Hemisphere’s summer driving season. Concerns about potential Middle Eastern conflicts affecting global oil supplies also contributed to the price hike.

UAE Fuel Price Adjustments

The UAE’s Fuel Price Committee revises retail petrol prices monthly to align with global market rates. In July, prices were slightly reduced by around 14-15 fils per litre. The current rates for Super 98, Special 95, and E-Plus 91 are Dh2.99, Dh2.88, and Dh2.80 per litre, respectively.

Impact and Market Sentiment

Rising fuel costs directly impact residents who commute long distances and sectors like freight and logistics. Vijay Valecha, Chief Investment Officer at Century Financial, noted that geopolitical tensions, particularly involving Israel and Hamas, could further disrupt oil supplies. Additionally, the market is anticipating the US Federal Reserve’s decisions, with many expecting a pause in interest rate changes, followed by a potential reduction in September.

Historical Price Data

Here’s a look at the fuel prices for the first half of 2024:

The Fuel Price Committee’s next announcement will reveal whether these trends will continue into August.