Why oil prices are still up
The main pressure point remains the Strait of Hormuz, one of the world’s most important energy shipping routes.
Around 20% of global oil and fuel supplies pass through the strait, and shipping activity has yet to fully normalise following recent disruptions and naval restrictions in the region. Even though tensions have eased compared to March, markets remain cautious because supply flows are still constrained.
Oil prices have also become highly reactive to developments around a possible US-Iran agreement. Any sign of progress in negotiations has pushed crude lower, while renewed uncertainty quickly sends prices higher again.
This explains why oil has been swinging sharply within short periods instead of settling into a stable trend.
How this affects UAE fuel
The UAE follows a market-linked pricing system introduced in 2015, meaning local fuel prices closely track international oil movements with a one-month lag. That means:
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April prices reflected March’s oil spike above $110–$120
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May prices reflected elevated April averages
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June prices will now reflect May’s still-high—but gradually cooling—oil market
In practical terms, motorists are unlikely to see another major surge similar to April. But because oil spent most of May above April’s average, the chances of a significant reduction also remain limited.
Petrol prices may stay broadly stable or rise slightly, while diesel could remain under pressure due to tighter global supply and shipping costs.
Why relief can take longer
Historically, UAE fuel prices rarely fall sharply immediately after a spike in crude oil. Instead, prices usually go through a stabilisation phase where markets slowly adjust before a clearer direction emerges.
Diesel prices often take longer to ease because global demand from logistics, transport, and industry remains strong even when crude starts falling. This suggests June could act as another transition month rather than the start of a major correction.
If oil stabilises below $100 for a sustained period and shipping flows through Hormuz improve further, more noticeable relief could appear later in the summer.
What motorists should watch
The next direction for fuel prices depends largely on three factors:
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Whether Brent crude stays below or moves back above $100 per barrel
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Material progress in US-Iran negotiations or preliminary deal
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Shipping activity resumes further through the Strait of Hormuz
April reflected peak disruption in global energy markets. May showed signs of cooling. June will reveal whether oil markets are finally stabilising—or whether volatility still has room to run.
Justin is a personal finance author and seasoned business journalist with over a decade of experience. He makes it his mission to break down complex financial topics and make them clear, relatable, and relevant—helping everyday readers navigate today’s economy with confidence.
Before returning to his Middle Eastern roots, where he was born and raised, Justin worked as a Business Correspondent at Reuters, reporting on equities and economic trends across both the Middle East and Asia-Pacific regions.