UAE petrol prices will increase for a third consecutive month in October as prices in global oil markets remain elevated amid lingering uncertainty around a potential US-Iran truce.
The cost of Super 98 petrol will rise to Dh4.40 a litre, up 15.7 per cent, while Special 95 increases by nearly 16 per cent, at Dh4.28.
E-Plus 91 has increased 16.6 per cent a litre, to Dh4.21, while diesel at Dh4.80 is up 11.6 per cent . Prices are about 80 per cent higher when compared to February, before the Iran war started.
How much will fuel cost in October?
Super 98: Dh4.40, from Dh3.80 in September
Special 95: Dh4.28, from Dh3.69
E-Plus 91: Dh4.21, from Dh3.61
Diesel: Dh4.80, from Dh4.30
The cost of fuel in the UAE has been tied to the global oil market since 2015, when deregulation was introduced. Traditionally, petrol prices have moved in sync with those benchmarks but not all the time.
Several factors influence monthly fuel costs and, although the mechanisms for setting these prices vary by nation, governments can also help control high prices at the pump.
Crude prices shot up again in September, with Brent nearing $110 and West Texas Intermediate topping $105 after the US and Iran resumed their offensives on each other, with the Strait of Hormuz remaining a flashpoint. In addition, Yemen's Houthi rebels escalated their attacks on Saudi Arabian facilities in the Red Sea.
Prices have eased over the past week on hopes that Washington and Tehran could reach a consensus for a longer-term peace deal, especially with the mediated talks held between the two sides at the United Nations General Assembly in New York. However, those efforts have hit a stalemate, with efforts to reopen the Strait of Hormuz continuing to stall.
Sources told The National on Tuesday that the US and Iran are quietly engaging in talks in New York to find common ground as a prelude to fully fledged negotiations to end seven months of conflict – although a clear breakthrough remains elusive.
So far this week, Brent, the benchmark for two-thirds of the world's oil, and West Texas Intermediate, the gauge that tracks US crude, are both down. This month, Brent has jumped about 9.5 per cent, while WTI has inched up by nearly 0.2 per cent.
Since the beginning of July – when UAE petrol prices last dropped as crude prices were at nearly prewar levels amid a detente between Washington and Tehran – Brent has shot up by nearly 45 per cent, while WTI has leapt by almost a third.
Oil flows through the Strait of Hormuz, meanwhile, rose to their highest level this month since the Iran war began, as Saudi Arabia was forced to send more crude through the contested waterway after Houthi attacks restricted its Red Sea route.
Saudi shipments through Hormuz jumped to 2.58 million barrels per day in September from around one million bpd in August, giving the kingdom 43 per cent of the strait’s oil traffic, preliminary Kpler data showed. The increase came as flows through the Bab Al Mandeb strait more than halved to 2.56 million bpd from 5.45 million bpd in August. The increase was not enough to reverse the broader decline in regional oil traffic.
