Fuel prices in the UAE are going up in May, the Ministry of Energy announced on Sunday. Petrol will be costlier by six fils and diesel by two fils.
The new per litre fuel prices for May are: Super 98 – AED2.01, up from AED1.95 in April; Special 95 – AED1.90, up from AED1.84; E Plus 91-AED1.83, up from AED1.77.
And the diesel price has been increased to AED1.97 per litre from AED1.95 in April. The new prices will come into effect from May 1.
Fuel prices have gone up as global oil prices recover due to an agreement reached between OPEC (Organisation of the Petroleum Exporting Countries) and non-OPEC members to reduce their output by about 1.8 million barrels per day from January 1.
Oil producing countries are planning to extend the six-month deal beyond June as global oil inventories continue to be high.
The global benchmark Brent crude is currently trading at $52.05 per barrel and US crude West Texas Intermediate at $49.33 per barrel.
April – UAE fuel prices dipped for the first time in 2017
Fuel prices for the month of April were reduced in the UAE. This was the first time in 2017 that fuel prices decreased.
Starting April 1,the prices per litre were set at AED1.95 for Super 98, which was down from AED2.03; AED1.84 for Special 95, down from AED1.92; and E Plus-91 at AED1.77, down from AED1.85. The diesel price was reduced to AED1.95 per litre from AED2.02.
The value of oil will have profound consequences around the world, with the potential to destabilise regimes, remake regions and alter the global economy in lasting and unforeseen ways.
Energy and power projects
The rise in oil prices will support MENA’s energy projects. Energy and power projects worth $622 billion in MENA and Iran are set to materialise between now and 2021. The Arabian Gulf region is the leading destination for $337bn worth of committed investment in projects under execution in MENA and Iran between now and 2021, according to the Saudi-based multilateral energy lender Apicorp.
Committed energy investments are two per cent higher than last year’s projection for the 2016 to 2020 period, and planned investments are 17 per cent higher, Apicorp said. Of the planned investments, the biggest share goes to power projects with $207bn, followed by oil with $195bn, gas with $159bn and the remainder in petrochemicals.
Projects under study worth $289bn are the largest part of planned investments and 19 per cent of all planned investments are in Saudi Arabia. Of the $337bn projects under execution, oil reigns supreme with $121bn in investments, followed by gas with $108bn, power with $91bn and petrochemicals with $17bn.
In the long-term, a drop in oil prices may lessen oil production and result in higher energy prices. But in the short-term, the loss of such a massive investment flow is bound to damage energy companies, particularly equipment suppliers and the construction and engineering firms that are commissioned to execute these projects.
The MENA region has led the growth of renewable energy with projects such as the Mohammad Bin Rashid Al Maktoum Solar Power Park in Dubai and the NOOR solar power complex in Morocco.
Additionally, Saudi Arabia’s Vision 2030 places renewable energy firmly in the energy mix of the future. It has set its initial production target at 9.5 gigawatts (GW) and aims to build a renewable energy industry that spans from technology origination to production of goods and services.
The problem is that low oil prices are wearing down the economic viability of cleaner energy sources like solar and wind. It could also delay investment into alternative ‘greener’ forms of energy, such as electric cars.
Low prices have motivated producers of renewable energy sources to develop their technologies and production methods, making these sources cheaper and more economically viable.
This, in turn, could make renewable energy more commercially attractive as the price of oil recovers.