By Staff writer
Price of diesel set to fall 29% following first monthly announcement by UAE's Ministry of Energy
Motorists discovered on Tuesday that they will have to pay on average more than 20 percent more for petrol in the UAE following a decision to deregulate gasoline and diesel prices and create a new pricing policy linked to global levels.
Prior to the change, retail prices ranged between AED1.61 per litre for Gasoline E Plus and AED1.83 per litre for Unleaded Gasoline 98, with Unleaded Gasoline 95 costing AED1.72 per litre.
According to an announcement by the UAE's Ministry of Energy on Tuesday, the first retail prices under the new policy will be as follows:
Unleaded Gasoline 98: AED2.25 per litre (up 22 percent)
Unleaded Gasoline 95 AED2.14 per litre (up 24 percent)
Gasoline E Plus: AED2.07 per litre (up 28 percent)
Diesel: AED2.05 per litre
The price of diesel, on the other hand, has fallen as it currently retails at AED2.90 in Dubai and the northern emirates, including Sharjah, Ajman, Umm Al Quwain, Ras Al Khaimah and Fujairah. The current price of diesel in Abu Dhabi is AED2.35.
The prices were announced by the UAE’s new Gasoline and Diesel Prices Committee which revealed its first monthly fuel prices for August.
The UAE announced last week that gasoline and diesel will be deregulated from August 1 and a new pricing policy linked to global levels will be introduced.
The committee, chaired by Dr Matar Al Nyadi, undersecretary of the Ministry of Energy, will meet on the 28th of every month to fix fuel prices.
In a statement, the committee said the impact on individuals will be minimal as the prices for cars with four cylinders will increase on average by nearly AED18, for 6 cylinder on an average by nearly AED25 and 8 cylinder by AED45.
"Such an increase would not create an additional burden on car owners with limited incomes. Additionally, it will promote rationalised consumption and incentivise people to choose most fuel efficient cars, while curbing the increase in the number of cars on the country's roads in the future."
The committee comprises senior representatives from the ministries of energy, economy and finance, and the CEOs of oil distribution and marketing companies, such as Abu Dhabi National Oil Company and Emirates National Oil Company.
Earlier on Tuesday, rating agency Moody's said scrapping fuel subsidies will cost UAE residents an average of $387 per head this year.
The Ministry of Energy on Monday confirmed that Emiratis will not receive compensation for the expected rise in living costs as a result of the changes.For all the latest retail news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
This is a good action to bring UAE at par. However, keeping in mind the inflation might increase for industries related to petrochemical and it would effect the salary class who might have to dig more deep down their pockets.
An excellent move by the UAE authorities. The price may still be low to make a major impact on rationalizing fuel consumption, but itâ€™s a great start. It would be good to have an education campaign for the public on how to drive more economical; I have seen something like this in the Netherlands via TV spots and news papers and was very successful. There are so many things people can do to reduce fuel consumption; a few things to be aware of:
-Cutting down your speed from 120km/h to 100km/h can reduce consumption by 20%
-On a 1500kg car, 100kg of baggage can increase consumption by 7%...
-Keep tires at recommended pressure. 25% low pressure can result in 2-5% increase of consumption
When buying a car, be aware that in general European build cars in this region have the most efficient engines in comparison, followed by Asian, and then American build brands when comparing 1:1.
Since most logistics, transport and industrial companies run on diesel we should expect a fall in overall inflation.
However will see what excuse my local "LuLu " store manager has to justify his latest increase in prices
I agree this is an excellent move. Prices are still much lower than what we pay in Europe, but even this increase will ensure that
1) People use smaller cars, there is no need for a 5 seater SUV like an X5 or CRV when a hatchback or sedan can fit 5 people as well
2) People use public transport and carpool
3) Environment will get cleaner
4) Traffic jams will reduce
So it is beneficial for the country and the people and the environment
Of course, the locals will now abandon their Batrol, Land Cruisers and G63s and all drive Tiidas.
Keep on dreaming buddy!
the people who make 7k and have to drive from Sharjah to Dubai for work every day will the ones who suffer!
Indeed it is good move and will help the nation , growth in long run with some additional cost on layman; which eventually paid from employer pocket via revised allowances or salary adjustment. Thank you Buddy for sharing important tips on reducing the fuel consumption.
No one is forcing them to live in Sharjah. It makes economic sense to live close to your workplace, it is inefficient to have a commute of an hour, so people working in Dubai should live close to work and that will save them a lot of money in fuel cost.
You are correct of course. This will be seen as an opportunity by many industries and business', effected or not, to raise prices to profit from the increase in fuel costs.
How long have you been here.
Have you tried walking for 1 km in 43 degrees, how you will sweat and stink the whole day.
Do you think people are living in Sharjah as the love to drive, NO, it is out of necessity and compulsion.
I do not understand how people compare apples with Oranges,
I.e. Europe to Gulf,
I agree with carpool, but then nothing is certain of return timings as at times one is forced to stay back and finish.
@Karl - your comment would make perfect sense if everyone paid the same rent.
However, the majority of people who live in Sharjah and work in Dubai do not live in Sharjah out of personal preference, but economic necessity. Rents in Sharjah are far lower than in Dubai. I would suggest that rents in Dubai are unaffordable for people earning 7k a month, particularly given Dubai's rules on sharing properties.
So what will happen is this. These people will see their fuel bills go up but NOT to the extent that it makes it cheaper to live in Dubai than to commute from Sharjah. That means these people will disproportionately suffer from the rising fuel prices.
What is really needed is to accompany rising, UAE-wide petrol prices, with deploying a UAE-wide mass transit system. As of present there is no simple way to get from somewhere in Sharjah to somewhere in Dubai without a car.