By Joanne Bladd
Price hike is the seventh since June 2009, will hit stations in Dubai and northern Emirates
Two of the UAE’s largest gas station operators, Emirates National Oil Co, or Enoc, and Emirates General Petroleum, or Emarat, are to ramp up the price of diesel by 15 fils to AED2.90 per litre from January 16, it has been reported.
The price hike is the seventh since June 2009 and will affect stations in Dubai and the northern Emirates, said local paper Al Khaleej.
Emarat and Enoc have been hit by rising oil prices as because they buy fuel at market prices and sell it at government-set rates.
The UAE, alongside other Gulf state, heavily subsidises fuel prices as a way of distributing oil income among their populations.
State-owned Emarat earlier this week said it is restructuring and needs bank loans because it must sell gasoline at below-market prices.
Chairman Obaid Humaid Al Tayer said there is a one dirham gap between the cost and selling price of a litre of fuel, but that Emarat was unable to raise prices without federal approval.
Enoc CEO Saeed Khoory said last year that the company needs oil prices at about $40 to $45 a barrel for it to break even on gasoline sales.
Oil hasn’t dropped below $50 a barrel since mid-2009 and traded above $91 a barrel on Wednesday.For all the latest energy and oil 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.