UAE to announce fuel prices for April 2024: Will petrol, diesel rates increase?

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The UAE fuel price committee is set to announce petrol and diesel prices for the month of April on Sunday, March 31.

READ MORE: This is how UAE fuel prices have fared in the last 14 months

The UAE announces the price of fuel – petrol and diesel, to be sold at retail outlets, at the end of each month for the following one.

Setting the fuel price

The UAE government deregulated fuel prices in 2015 to allow them to be on par with the global market however, it was again frozen in 2020 during the Covid-19 pandemic.

The price controls were then lifted in March 2021 to align the fuel rates with global market once again.

Domestic fuel costs are governed by a combination of factors such as the Dirham/Dollar exchange rate combined with international oil prices. The prices announced each month also reflect factors such as state levy adjustments or retail margin changes. The committee determines these adjustments, considering various factors, at the end of the month.

Fuel prices in 2024

The UAE fuel price committee has raised prices in February and March this year to align with the global price range.

Global tensions impact oil supply

Oil prices settled higher on Monday, as orders from the Russian government to curb oil output, offset the United Nation’s demand for a ceasefire in Gaza.

Brent crude futures settled $1.32 higher or 1.55 per cent, at $86.75 a barrel. US crude futures settled $1.32 higher, or 1.64 per cent, at $81.95.

Both benchmarks have risen steadily this year, with Brent up nearly 11 per cent and WTI up about 12.5 per cent by Friday’s close, on expectations that interest rates in major economies will come down by the summer, and geopolitical tensions in eastern Europe and the Middle East.

Moscow, meanwhile, has ordered companies to reduce oil output in the second quarter to meet a production target of 9 million barrels per day (bpd) by the end of June, in line with its pledges to the producer group OPEC+, three industry sources said on Monday.

“Russia is committed to the OPEC+ cuts. They are looking beyond the current supply and demand fundamentals and looking at unity with OPEC+, as well as the risk of a bigger price shock further down the road,” said Phil Flynn, analyst at Price Futures Group.

Russia’s crude oil supply is down 7 per cent of total refining capacity, Reuters calculations show, on top of unrelated maintenance.

UN vote on Gaza ceasefire

Elsewhere, the United Nations Security Council adopted a resolution on Monday demanding an immediate ceasefire between Israel and Palestinian group Hamas and the release of all hostages after the US abstained from the vote.

“We will have to see how the UN resolution on a ceasefire actually plays out on the ground in Gaza, and whether that would ultimately result in the Houthis stopping their attacks on tanker traffic in the Red Sea,” Andrew Lipow, president of Lipow Oil Associates said.

Yemen-based Houthis have been ramping up attacks on ships traversing the Red Sea in support of Palestinians in Gaza.

A ceasefire could help relieve supply bottlenecks if the Houthis wind down their attacks by allowing vessels to use the Suez Canal rather than taking longer, more costly diversions around the horn of Africa.