UAE fuel prices stay 28% above pre-war levels as crude volatility persists

UAE fuel prices remain 28% higher than levels recorded in January 2022, despite recent downward adjustments at the pump. While global crude benchmarks have retreated from the peaks seen after the start of the Russia-Ukraine conflict, local retail prices for Super 98 and Special 95 are unlikely to return to the Dh2.50–Dh2.60 range in the immediate future. The UAE fuel price committee, which meets monthly to align domestic rates with international markets, set August 2024 prices at Dh3.05 per litre for Super 98 and Dh2.93 for Special 95. These figures compare to Dh2.65 and Dh2.53 respectively in early 2022. The disparity persists because international oil prices are currently trading between $75 and $82 per barrel, significantly higher than the $65–$70 range seen during the pre-conflict period. Market volatility and regional demand Several factors prevent a rapid return to lower price brackets. OPEC+ production cuts, led by Saudi Arabia and the UAE, have tightened global supply to support price floors. Additionally, increased regional demand for cooling and transport during the summer months in the Middle East maintains pressure on refined product inventories. Analysts at Mitsubishi UFJ Financial Group (MUFG) indicate that while a global economic slowdown could dampen demand, geopolitical risks in the Middle East continue to add a "risk premium" of $5 to $10 per barrel. For UAE motorists, the current pricing structure means the cost of filling a 50-litre tank is approximately…