Petrol prices in the UAE for January 2026 will be announced at the end of the month, with early indicators pointing to a possible marginal decline as global oil prices remained relatively subdued in December.
Brent crude, the benchmark used to price most global oil contracts, averaged $61.51 per barrel in December 2025, down from $63.7 per barrel in November. Over the weekend, Brent closed at $60.64 per barrel, while West Texas Intermediate (WTI) settled at $56.74.
Since deregulating fuel prices in 2015, the UAE has adjusted retail petrol and diesel rates monthly in line with international oil market movements, as part of broader economic diversification policies.
Despite softer global prices last month, UAE fuel rates for December 2025 were revised upward. Super 98 was priced at Dh2.70 per litre, Special 95 at Dh2.58, and E-Plus at Dh2.51.
Oil prices have seen some upward momentum in recent days, driven by renewed concerns over supply risks linked to rising geopolitical tensions in Venezuela and the ongoing Ukraine–Russia conflict.
Ole Hansen, head of commodity strategy at Saxo Bank, said oil markets are entering 2026 with what appears to be a comfortable supply outlook, marked by rising inventories, easing demand growth, and a relatively flat futures curve. However, he cautioned that deeper structural risks remain.
Hansen pointed to the International Energy Agency outlook, which suggests oil demand will continue to rise beyond 2040. Combined with natural depletion rates of 6 to 8 million barrels per day each year from existing fields, this means the industry must continuously replace large volumes of supply.
“Short-term indicators do not point to a major glut in 2026,” Hansen said, noting that the oil futures curve only shifts into contango later next year. “Any softness early in the year is likely to be temporary, not a repeat of the 2020–21 downturn.”
He added that spare capacity within OPEC+ remains limited, while production growth from non-OPEC+ producers such as the US, Brazil, and Guyana may begin to level off. At the same time, potential supply increases from Iran, Russia, or Venezuela face constraints.
“Failing to incentivise long-cycle investment now risks a supply crunch in the early 2030s,” Hansen warned.
For investors, he said these structural pressures support positioning for higher and more sustained crude prices over the longer term. “The real question is whether prices firm gradually to encourage investment, or whether delayed investment leads to a sharper spike later. Earlier and steadier price signals would help minimise economic disruption,” he added.
