Transport firms protest diesel price hikes

INCREASED COSTS: Transport firms say fuel retailers are hiking prices to compensate for losses on petrol, making it difficult to do business. (Getty Images)

UAE transport firms have called for government action over skyrocketing diesel prices, which have increased by 175% in the past three years, it was reported Tuesday.

Companies have accused fuel retailers of increasing diesel prices to compensate for losses on petrol, said Emirates Business 24/7. The firms say the government should now step in and regulate the price of diesel as it does for petrol.

Fleet operators said continuous price hikes were making it difficult to do business, and that the burden of increased costs is being passed on to the public.

The massive hikes are also discouraging foreign operators from carrying out business in the country, a source from the Saudi Arabian Public Transport Company told Emirates Business.

Retailers have denied the increases are an attempt to recover losses on petrol, saying they make no profit from diesel which is sold at cost price.

An Eppco official told the business daily, “We lose an average of 6 million dirhams every day in sales of petrol as we are selling it on much lower prices than the prices we buy it for.

“And the money we generate from the sale of diesel does not cover these losses at all. The price at which we are currently selling diesel is the cost price, which means we are not making any profit out of diesel.”

Diesel prices in neighbouring GCC countries are kept low by government backing, he added. Diesel is around seven times cheaper in Saudi Arabia than the UAE, fuelling a black market between truck drivers between the two countries.

Print | Email | Discuss this article |

READERS' COMMENTS

View all comments (0)

Have your say

Click here to post a comment

Add your Comment All posts are sent to the administrator for review and are published only after approval. ArabianBusiness.com reserves the right to remove any comment at any time for any reason. Please keep your responses appropriate and on topic.
Name *
Remember me on this computer
Email *	(Your email address will not be published)
City
Country
Subject *
Comment *
Notify me of further comments
Security Code *
Please click post only once - your comment will not be published immediately.

MORE FROM ARABIANBUSINESS.COM