The UAE Ministry of Energy, after its meeting in Abu Dhabi yesterday, further lowered fuel prices for January 2016.
The Fuel Price Committee has reduced the price of diesel by about 12% or 22 fils, from AED1.83/litre for December to AED1.61/litre in January.
The prices for gasoline products were also reduced considerably by 10 fils per litre each. Prices for E Plus 91 has been reduced from AED1.61 in December to AED1.51 in January, unleaded gasoline 95 from AED1.68 in December to AED1.58 in January, and unleaded gasoline 98 from AED1.79 in December to AED1.69 in January.
The Fuel Price Committee has been tasked with revising and announcing fuel prices on the 28th of each month (for the following month), although this month the decision came two days ahead of schedule.
Chaired by the Undersecretary of the Ministry of the Energy Dr. Matar Al Neyadi, the committee includes members including the Undersecretary of the Ministry of Finance, CEO of ADNOC Distribution, and CEO of Emirates National Oil Company (ENOC).
Commenting on the fuel prices for January, Neyadi told Gulf News that the impact of the slashed fuel prices will be positive.
“The decision has been implemented for the last six months. We are proud on how it is being implemented and the reaction from the market. Definitely the price of goods and services will go down,” he said, but did not provide a forecast when asked on how long oil prices will remain low.
The UAE in August this year decided to lift subsidies on fuel prices, by making them ‘market-linked’.
While announcing the decision at the time, the UAE Minister of Energy Suhail Mohamed Al Mazrouei had said, “The decision related to gasoline and diesel is aimed at supporting the national economy, lowering fuel consumption, protecting the environment and preserving national resources.”
Experts believe that the UAE authorities have carefully chosen 2015 to introduce the landmark decision of lifting subsidies.
Despite the deregulation, fuel prices are expected to remain low, as global crude oil prices continue to tumble and is currently trading at around $40 a barrel.
Analysts see no sign of oil price recovery in 2016 and predict prices to either fall further or remain stagnant, at best around the $50/barrel mark.
This effectively means that UAE residents will continue to enjoy low fuel prices for the foreseeable future.
