Oil prices have come under intense scrutiny all over the world, with the United Arab Emirates one nation where the value of crude is being talked about. In March, the price of a barrel of oil stood at 189.67 dirham, moving down from the previous month’s price, although the prevailing trend reveals plenty of ups and downs.
Globally, the price of oil has been low for some time. Refusal on the part of some oil-producing countries to lower production has played its part, as has poor economic performance in Europe, China and Brazil. For much of last year, the price of a barrel of oil was below the historic $50 mark, although there has been something of a recovery.
Since November 2016, there has been a slight upturn in prices. From what was a very low base of just 166.29 dirhams, it has risen by 14% from that point onwards. Almost nudging 200 dirhams in February, the signs were there to suggest that oil prices were recovering to a sustainable level. Surprisingly, a twist was soon to come.
With a significant dip occurring in March, all forward momentum gained during the previous few months had taken a hit. Since then, those who are CFD trading in the Middle East have not known where to put their money. Figures from April onwards suggest that the volatility that affected oil prices for much of 2016 is set to return.
Reflecting the rise in the value of Brent Crude to over $50 a barrel, prices at the fuel pumps were hiked up marginally for this month. Prices are set across the UAE by the government before the start of each month. They are based on benchmark prices before being passed on to consumers at petrol stations across the country.
What next month’s prices are likely to be is unknown, but if the fortunes of Brent Crude are anything to go by, a further rise is likely. Since the start of this month, the price has risen from just over $51 a barrel to $53.15. However, it did dip to around the $48.40 mark as recently as May 4th, so a further fall between now and the fuel price announcement cannot be ruled out.
The future for oil prices in the UAE is likely to remain uncertain. A long way from the dizzying heights of 2008, oil could easily go in either direction. Although the trend is for a slight upturn, there are still several trading days left for the oil markets to influence the decision on June’s oil prices, as well as those for the next few months.
The likelihood of oil reaching the levels it did towards the end of the last decade is low. That being said, a rise for June could be possible. News about potential cuts in production from OPEC members, including the UAE, may give traders and oil firms encouragement that May’s rise will spark a welcome upturn that will leave behind the depths of November 2016.