Motorists in the UAE could face another increase in fuel costs as the country’s fuel price committee prepares to announce petrol rates for June later this week.
Petrol prices are expected to rise for a fourth straight month after global crude oil prices remained elevated throughout May, driven largely by supply concerns linked to tensions in the Middle East and the closure of the Strait of Hormuz following the US-Israel-Iran conflict.
Brent crude averaged around $106 per barrel in May, up from roughly $99 per barrel in April, reflecting continuing pressure on global energy markets. Oil prices remained above the $100 mark for much of the month as disruptions to supply routes through the strategic waterway tightened availability.
By the weekend, Brent crude closed at approximately $103.5 per barrel, while West Texas Intermediate settled near $96.6.
The sustained rise in oil prices has already translated into higher fuel costs across the UAE. In May, petrol prices increased for the third consecutive month, with Super 98 priced at Dh3.66 per litre, Special 95 at Dh3.55 and E-Plus at Dh3.48.
The increases mark a sharp climb since February, when Super 98 sold for Dh2.45 per litre. Since then, premium petrol prices have risen by about 50 per cent, adding Dh1.21 per litre to motorists’ fuel bills.
The UAE adjusts fuel prices monthly to reflect international oil market movements, making domestic rates sensitive to shifts in crude prices and geopolitical developments.
Fuel costs play a significant role in household spending, particularly for commuters and families heavily dependent on private transport. While monthly changes may appear modest, repeated increases can place additional pressure on budgets as transport remains a recurring expense.
The latest price trend has revived memories of 2022, when fuel prices in the UAE surged to record levels after the Russia-Ukraine war disrupted energy markets worldwide. In July of that year, petrol prices exceeded Dh4 per litre for the first time, with Super 98 reaching Dh4.63 and Special 95 climbing to Dh4.52.
Despite current upward pressure, analysts say oil markets could still shift direction if diplomatic progress emerges between Washington and Tehran.
Rania Gule, senior market analyst for the Middle East and North Africa region at XS.com, said a potential agreement between the United States and Iran could push crude prices lower by increasing global supply.
“Any anticipated agreement between Washington and Tehran would exert direct downward pressure on oil prices due to expectations that part of the Iranian oil supply will return to global markets,” she said.
According to Gule, an official deal could trigger an initial decline in oil prices ranging from 4 to 8 per cent, as geopolitical risk premiums ease and supply concerns diminish.
Until then, UAE motorists are bracing for another possible rise at the pump when June fuel prices are announced.
