UAE to announce petrol prices for November: will rates drop further?

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The UAE fuel price committee will soon revise retail fuel prices for November to align them with global rates.

Since the government deregulated oil prices in August 2015, the UAE has been adjusting retail petrol prices on the last day of each month to align with global rates. Each month, the Ministry of Energy sets fuel prices based on the average global oil prices, whether they have gone up or down.

The retail prices also include the operating costs of distribution companies.

Petrol prices dropped by as much as 0.24 fils per litre in October, pricing Super 98, Special 95 and E-Plus 91 at Dhs2.66, Dhs2.54 and Dhs2.47 per litre, respectively.

The cost of diesel also dropped marginally to Dhs2.60 in October compared to Dhs2.78 in the previous month.

Global oil prices tumbled more than $3 a barrel on Monday after Israel’s retaliatory strike on Iran over the weekend amid fears of an escalating conflict in the Middle East. Brent crude traded near $72.66 a barrel, down $3.39 or 4.47 per cent, as of 09:03 GST on October 28, while US West Texas Intermediate (WTI) crude futures dropped by $3.29 or 4.56 per cent to $68.50 a barrel.

The oil market has concluded that the Israeli attack and the Iranian response effectively de-escalated recent heightened tensions.

However, the risk of renewed escalation and miscalculation persists due to the involvement of various state and non-state actors in the region. The uncertainty makes it difficult to determine the appropriate level of risk premium to incorporate into oil price forecasts.

Meanwhile, the OPEC+ group of exporters is still scheduled to start winding back some of its production cuts from December, with a target of lifting output to 180,000 barrels per day (bpd), the first step in a series of increases over 2025.

The group, which includes the Organization of the Petroleum Exporting Countries and allies including Russia, earlier delayed its plan to start lifting output from October, given the downtrend in crude prices that has been in place since early July. The group will meet on December 1 ahead of a full meeting of OPEC+.

Read: UAE cuts petrol, diesel prices for October 2024