Motorists will see a bigger hit on their wallets during Ramadan as the price of petrol is set to increase for a third consecutive month on the heels of a slight rebound in oil prices.
The prices across the board are to rise nearly 5 per cent, while diesel will see the biggest hike at 10 per cent.
From Wednesday, Super will cost Dh1.86 a litre compared with Dh1.78 in May, Special will be Dh1.75 from Dh1.67, E Plus Dh1.68 from Dh1.60 and diesel to Dh1.77 from Dh1.60.
The increase corresponds to the slight rebound in the price of Brent crude, the global benchmark, which rose briefly past US$50 a barrel last week – the highest it has reached this year. In fact, the monthly average of oil price has increased nearly 40 per cent since January which has brought a rise in petrol prices of about 10 per cent.
While diesel costs will affect large fleet owners such as lorries and buses, other industries, such as construction, could be affected as a result of diesel-powered generators.
Omer Ghani, chief executive of Dubai-based battery maker Kilowatt Labs, said that the rise in diesel just made a stronger case for renewables. “It’s the market volatility of fossil fuels that makes an unpredictable business case,” he said, giving an example that a solar generator would instead have a fixed long-term rate, cutting out the risk.
He said that many companies did not even look at the diesel pricing structure anymore as a result of alternative solutions, such as solar, providing a gateway to avoid external factors such as market fluctuations.
“It’s not just the price that a user has to do deal with regarding diesel, it’s the whole complex situation from tank storage to theft, all of which are basically unaccounted for when you just [list] the price of diesel,” Mr Ghani said. “And that’s not the cost you’re really dealing with.”
lgraves@thenational.ae
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