Business | Oil & Gas
Oil companies across UAE may cut diesel price
Dubai oil retailers - Emirates National Oil Company (Enoc), Emirates Petroleum Products Company (Eppco) and Emarat may again cut the price of diesel soon to reflect the prevailing international crude oil and oil product prices, oil industry sources told Gulf News.
- By Himendra Mohan Kumar, Staff Reporter
- Published: 23:32 October 28, 2008
Abu Dhabi: Dubai oil retailers - Emirates National Oil Company (Enoc), Emirates Petroleum Products Company (Eppco) and Emarat may again cut the price of diesel soon to reflect the prevailing international crude oil and oil product prices, oil industry sources told Gulf News.
"It's a possibility, given the fact that crude oil and oil product prices are sharply down on the international market," said a source from Emarat.
Dubai oil retailers last cut the price of diesel by Dh0.70 on October 20. The price of diesel in the emirate is currently Dh14.55 a gallon.
The cut marked the oil retailers' ninth straight cut in diesel prices and their single-biggest cut since July 28.
Diesel was selling at Dh19.25 a gallon, an all-time high on that date and ever since the oil product's price in Dubai has steadily been going down due to weaker crude and oil product prices on the international markets.
The three oil retailers buy diesel at international prices and then adjust the local prices, based on the landed cost of the oil product. Diesel is widely used in the UAE as a transportation fuel with trucks that carry goods, as main users. Any increase in the price of the fuel means greater inflationary pressures for the consumer as the fuel price rises are invariably passed on across the supply chain.
International oil prices have fallen sharply from a lifetime high of $147.27 (Dh541) a barrel on July 11, as an economic downturn and upheavals on the US financial markets, the world's biggest oil importer, has slowed consumer demand.
Dollar strengthens
There are also fears the world's second biggest economy, Japan, may be slipping into recession.
The US dollar, a currency in which oil trading is mostly done, has been strengthening against the euro, which has added to the bearish sentiments that currently prevail on the world's oil markets.
Crude oil futures for December delivery in the US were trading below $65 a barrel yesterday on the New York Mercantile Exchange.
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