UAE: Why petrol prices could drop further in December

UAE Petrol prices could ease slightly further in the UAE next month as global oil prices remain under pressure due to surplus fears in 2026.

The average Brent’s closing price was around $63.7 a barrel in November compared to $65.22 in October. This means retail fuel prices could see a slight downward adjustment, but an official announcement will be made at the end of this week. The UAE has aligned its retail petrol prices with global oil rates in 2015, removing subsidies in line with the economic diversification policies. The petrol and diesel prices for the upcoming period are adjusted based on the fluctuation of global oil prices.

On Tuesday morning, Brent and WTI were trading at $63.10 and $58.62 per barrel, respectively.

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The UAE reduced prices for the month of November by around 14-15 fils per litre with Super 98, Special 95 and E-Plus 91 selling at Dh2.63, Dh2.51 and Dh2.44 per litre across Adnoc, Emarat and Enoc petrol stations. Petrol prices have dropped for the past two consecutive months in the UAE.

Crude oil prices remain pressured amid sustained optimism from US-Ukraine talks, which is offsetting the risk of Russian supply disruptions. However, the upward movement remains limited due to the macro headwinds.

Some 48 million barrels of Russian oil remain languishing at sea due to US sanctions, but weak consumption trends and Opec+’s revised forecast of a surplus are pressuring the black gold. Meanwhile, uncertainties about Ukrainian-Russian peace negotiations continue, as the possibility of progress will remove the sanctions and unleash large amounts of parked oil onto the market.

Vijay Valecha, chief investment officer, Century Financial, said oil sentiment remains bearish as Opec+ and non-Opec producers increase output, adding to concerns about oversupply.

In addition, Ukrainian President Volodymyr Zelenskiy agreed to work on a peace plan, as US sanctions on two Russian oil giants took effect on Friday.

“Proposals include Ukraine ceding territory and the removal of sanctions. This would add more supply to a market facing a large surplus next year, having a negative impact on oil prices,” he said.

Waheed Abbas

Waheed Abbas is Assistant Editor, covering real estate, aviation and other business stories that directly affect the lives of UAE consumers. He frequently reports human interest stories, too.