Dubai: The Ministry of Energy has announced that fuel prices across the UAE would be deregulated starting on August 1, 2015, adopting a new policy linked to global prices.
Here is a look at the details of the new pricing mechanism and how it will work, according to WAM:
• The ministries of Energy and Finance will act as the government’s representatives in a committee set up to review fuel prices in the UAE every month. They will focus on consumer protection and ensure that petrol prices are balanced according to international standards, according to Dr Matar Al Nyadi, Undersecretary of the Ministry of Energy and Chairman of the petrol and Diesel Prices Committee.
• The fuel price committee also includes as members the Undersecretary of the Ministry of Finance, CEO of Adnoc Distribution, and CEO of Emirates National Oil Company (Enoc).
• The pricing mechanism will be structured in a way that it does not rely on just one global market and will facilitate distribution companies to make reasonable profits and to limit their losses while offering premium services.
• The committee will urge fuel distribution companies in the UAE to increase their operational efficiency to lower their costs, and eventually impact positively the prices of petrol and diesel at petrol stations across the country.
• On the 28th of each month, the committee will announce the prices for the following month. In line with this decision, prices of petrol and diesel for August will be announced on July 28, based on the average global prices with the addition of operating costs.
• The Ministry of Energy has assigned a dedicated number (0565467942) and an email ID (email@example.com) for public inquiries on the new deregulated fuel prices.
UAE deregulates oil prices: The big numbers
The Ministry of Energy has announced that fuel prices across the UAE would be deregulated as of August 1, 2015, adopting a new policy linked to global prices. The decision, ratified by the UAE Cabinet, is aimed at supporting the national economy, lowering fuel consumption, protecting the environment and preserving national resources. Here is a look at critical statistics related to the UAE’s fuel consumption:
• The UAE transport sector was responsible for 22 per cent of the total greenhouse emissions in the country in 2013.
• Total greenhouse emissions in the UAE in 2013 amounted to 44.6 million tons of carbon dioxide.
• Increasing the use of public transport and reducing dependence on individual vehicle usage will have a positive impact in lowering carbon emissions, according to Suhail Al Mazroui, Minister of Energy.
• The cost of petrol represents 3 per cent to 4 per cent of an average income in the UAE, according to Al Mazroui, which is a reasonable percentage compared to international costs. Deregulating prices therefore would not have a notable impact on the cost of living.
• Considering the international prices of oil and petroleum derivatives, the UAE expects diesel prices to go down. This will stimulate the economy as lower diesel price would mean lower operating costs for a wide number of vital sectors like industry, shipping and cargo among many others, according to Al Mazroui.