The Fuel Price Committee of the UAE has announced updated retail fuel prices for August, reflecting an increase in pump rates for both petrol and diesel amidst rising global crude oil prices, as reported by WAM, the state news agency.
– Diesel: Dhs2.78 per litre, up from Dhs2.63 per litre in July
– Super “98”: Dhs2.69 per litre, down from Dhs2.70 per litre last month
– Special “95”: Dhs2.57 per litre, reduced from Dhs2.58 per litre in the previous month
– E-Plus “91”: Dhs2.50 per litre, down from Dhs2.51 per litre in July
Oil Prices Dip Amid Mixed Market Signals
On Thursday, oil prices experienced a slight decline as traders considered potential supply shortages due to US President Donald Trump’s efforts to quickly resolve the escalating situation in Ukraine with increased tariffs. However, a surprising rise in US crude inventories tempered the decline.
Brent crude futures for September, which were set to expire on Thursday, fell by 18 cents, or 0.3 percent, to $73.06 a barrel by 0650 GMT. The more actively traded Brent October contract decreased by 26 cents, or 0.4 percent, to $72.21.
In addition, the US West Texas Intermediate crude for September dropped by 17 cents, or 0.2 percent, to $69.83 a barrel. Both benchmarks had settled 1 percent higher the previous day.
Market analyst Priyanka Sachdeva from Phillip Nova noted that “oil contracts have been stuck in a range today, with neither buyers nor sellers showing the confidence to push prices significantly up or down, especially with the looming August 1 deadline for new US tariffs.”
Market Forces at Play
The market faces conflicting influences. President Trump’s assertive stance on Russian oil sanctions has led to higher market premiums, while a strong dollar, sluggish indicators of global economic growth, and the unexpected increase in crude inventories have limited upward price movement. Trump has indicated he may impose significant tariffs on countries trading with Russia if there is no progress in ending the conflict within 10 to 12 days, which is a reduction from an earlier 50-day timeline.
Analyst Toshitaka Tazawa at Fujitomi Securities highlighted that “fears regarding secondary tariffs on nations importing Russian crude are sustaining buying interest.” The US government has also warned China, the top purchaser of Russian oil, it might face substantial tariffs if it continues its purchases.
Unexpected Crude Inventory Increase and Gasoline Decrease
According to the Energy Information Administration, US crude oil inventories rose by 7.7 million barrels during the week ending July 25, reaching a total of 426.7 million barrels, primarily due to reduced exports. Analysts had predicted a decrease of 1.3 million barrels.
Conversely, gasoline inventories fell by 2.7 million barrels to 228.4 million barrels, significantly surpassing forecasts calling for a decrease of 600,000 barrels.
Fujitomi Securities’ Tazawa added, “While the US inventory report indicated an unexpected increase in crude stocks, the larger-than-anticipated reduction in gasoline stocks supports the notion of robust demand during the driving season. This resulted in a balanced impact on the oil market.”