Fuel to be cheaper in June as prices slashed

Abu Dhabi: Fuel is going to be cheaper in June as the Ministry of Energy slashes petrol prices by five fils and diesel by seven fils. The new prices will come into effect from June 1.

Special 95 will cost Dh1.85 per litre in June as against Dh1.90 per litre in May. Similarly, Super 98 will cost Dh1.96 per litre next month, down from Dh2.01 in May and E Plus-91 Dh1.78, down from Dh1.83 in May, the energy ministry said on its website.

Diesel prices too were reduced from Dh1.97 in May to Dh1.90 per litre in June.

This is the second decrease in rates for fuel prices this year after the Ministry of Energy slashed prices In April in line with international crude oil prices which have been fluctuating due to supply, demand equation.

Oil prices plunged nearly 5 per cent on Thursday after Opec (Organisation of the Petroleum Exporting Countries) and other major exporters extended their current deal to limit oil production for another nine months.

Thirteen members of the Opec and 11 non-Opec members agreed to cut production by about 1.8 million barrels a day to support oil prices in December last year for six months.

The agreement came into effect from January 1 and was supposed to have ended at the end of this June.

Opec agreed to slash output by 1.2 million barrels a day and non-Opec members led by Russia by 558,000 barrels a day.

Brent, the global benchmark is currently trading at $52.15 per barrel, and US crude West Texas Intermediate at $49.80 per barrel. At the beginning of the year, Brent was trading at $56.82 per barrel.

Saudi Arabia’s energy minister Khalid Al Falih said during the Opec meeting last week that daily fluctuations will ultimately correct with demand going up in Asia and the US.

“The long-term trend is going to be healthy and supportive with the demand picking up in the US, India and China,” he said in a speech posted on Opec’s website.

Sanyalaksna Manibhandu, director of research at the National Bank of Abu Dhabi Securities expects Brent to trend in the range of $49 to $55 per barrel during the rest of the year if there is no change in the demand and supply side.

“Oil price might slip below $49 per barrel if Opec and non-Opec member countries don’t stick to the deal and start increasing their production but conformity to the deal is expected to be high as was seen in the first half of the year,” he told Gulf News over phone.

“Market will be looking to the next Opec meeting in November for any fresh news that could impact oil prices.”