Motorists will have to pay more to refill their vehicle’s fuel tank in October as fuel prices have been increased in the UAE. The Ministry of Energy announced the new fuel prices on September 27, 2018 and according to the announcement, fuel prices for the month of October have been increased significantly. Setting a monthly fuel budget has become extremely difficult for motorists on a tight budget during 2018 as fuel prices have increased to a record breaking level thrice this year. It is the third consecutive increase in fuel prices, which will add to the financial worries of motorists on a tight budget who were already struggling to manage their monthly fuel budget.
One of the most important factors that directly affect the fuel prices in the UAE is the price of Brent (Crude Oil Benchmark) in the international market. Brent was trending at a four-year high price on Tuesday, September 25, 2018, which led to a significant increase in fuel prices for the month of October. Fuel prices have been increased for all fuel types including diesel and different variants of petrol.
New Fuel Prices in the UAE
Fuel prices have been hiked for the third consecutive month and for the seventh month in 2018 collectively. What is more concerning for motorists is the fact that fuel prices for the month of October have jumped to a record-breaking level for both diesel and petrol. While the price of diesel is the highest since August 2015, the price of Special 98 petrol is the second highest during the same period.
For October 2018, the price of diesel has been increased by a massive 12 fils per litre. On the other hand, the price for both petrol variants has been increased by 2 fils per litre.
Here are the new prices for diesel and different variants of petrol:
- The price of diesel for the month of October will be AED 2.76/litre.
- The new price of Super 98 will be AED 2.61/Litre.
- The new price of Special 95 for the month of October will be AED 2.50/Litre.
The fuel prices for October in the #UAE as announced by the UAE Fuel Price Committee ⛽ pic.twitter.com/WhZep5HEc4
— ENOC (@ENOC) September 27, 2018
Why Fuel Prices have been increased?
As mentioned earlier, fuel prices are directly linked with the price of Brent in the international market. Any increase or decrease in Brent price directly affects the price of fuel in the UAE. The price of Brent reached a record-breaking level on Tuesday, September 25, 2018, which resulted in a significant hike observed in the UAE’s fuel prices. For the first time in last four years, Brent was trading at $82.23 per barrel on Tuesday and experts have predicted it to become even costlier in coming months.
According to Commodity traders Trafigura and Mercuria, the price of Brent can rise to $90 per barrel by Christmas and there are possibilities of it surging past $100 per barrel in the early 2019.
While Brent is the biggest factor that directly affects fuel prices in the UAE, there are also some other factors which can cause an increase or decrease in fuel prices. The Ministry of Energy in the UAE also considers Platts Benchmarks (latest information on price of crude oil and gasoline products) and the current transportation cost of fuel while setting new fuel prices for the coming month. The massive hikes in fuel prices observed during 2018 is also because of the addition of 5% VAT in monthly fuel prices. VAT has been implemented on all commercial and business activities in the UAE from January 1, 2018.
Also read: An Introspective Analysis of Fuel Price Trends in the UAE during the First Half of 2018
How Motorists Can Reduce their Fuel Expense?
It has become critical for motorists on a tight budget to find ways of reducing their fuel expense as fuel prices are predicted to increase in the coming months as well. During 2018, fuel prices have increased in 7 out of 10 months, which has followed the trend of fuel prices from last year when 8 out of 12 months recorded an increase in prices. Motorists on a tight budget need to reduce their fuel expense to manage their monthly fuel budget effectively and to achieve that, they need to bring a much-needed change to their mindset.
It is the need of the hour for motorists to consider shifting from their conventional combustion engine vehicles to fuel-efficient and eco-friendly hybrids or Electric Vehicles (EVs). Hybrids can be an excellent choice as they come with a secondary source (electric batteries) to generate power in addition to the conventional combustion engine, which reduces their dependence on conventional fuel.
EVs on the other hand, don’t need conventional fuel at all as they have electric batteries as their only source to produce power. EVs also ensure zero emissions and with more motorists shifting from their conventional vehicles to EVs, it can potentially play a critical role in reducing the carbon foot print of the UAE. This is a major reason why the UAE government is also urging people to purchase EVs.
Also read: 5 Most affordable EVs available in the UAE
Buying an EV can help motorists get rid of their financial worries related to increasing fuel prices in the UAE. It can be an excellent decision also because the government of the UAE is offering a number of incentives to EV buyers and owners in order to promote sales of EVs in the country.
To know about the incentives and benefits offered to electric vehicle owners and buyers in the UAE, read our blog titled, New Incentive Program Encourages the Buying of Electric Vehicles in the UAE.
If you are planning to sell your combustion engine car to buy a fuel-efficient hybrid or EV, then don’t forget that with us, you can sell any used car in just 30 minutes while all the post-sale paperwork is handled by SellAnyCar.com’s team.
