How will fuel costs change in the United Arab Emirates?
The UAE sets fuel prices based on the average oil price over the past month. This creates a delay effect:
Possible direction for May:
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Gasoline prices: stable or slightly lower
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Oil: likely to remain elevated
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Overall trend: no repeat of April’s rise, but limited relief, with current market strength unlikely to reverse May’s higher prices at this stage
Despite the recent rally, May’s price is effectively locked out of April’s averages, meaning recent gains above $100 are more likely to affect June prices than May.
Why won’t prices fall faster?
Oil may have cooled earlier, but new disruptions are pushing it higher again. The Strait of Hormuz remains effectively restricted, limiting the movement of tankers, with around 20% of global energy supplies passing through this route. An ongoing maritime blockade is preventing Middle Eastern crude from reaching global markets efficiently.
At the same time, Iran has signaled that it may reopen the strait if the US lifts its blockade, but there is no clear progress in negotiations. Markets are reacting to continued disruption rather than any resolution.
However, supply fears are being partially offset. Iran continues to export crude despite restrictions, with millions of barrels loaded and moved in recent days. Some shipments appear to be bypassing monitoring systems, suggesting that supply chains are strained but not completely disrupted.
What happens after a stroke
Past price cycles in the UAE show a consistent pattern:
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Sharp increases are followed by partial pullbacks, not immediate returns
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Prices stabilize over one to two months before a clearer trend emerges
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Oil often remains in decline due to tighter global supply
This indicates that May acts as a holding phase.
Scenarios for fuel prices in May
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Oil remains elevated around $100-$110 as most May prices reflect earlier, lower April averages
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UAE prices remain stable or slightly lower
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Outages in Hormuz continue or worsen
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Brent holds levels above $105
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Market price in extended supply constraints
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Transportation through Hormuz has been normalized
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Diplomatic progress reduces risk premiums
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Relief moves to June prices
What drivers should look for
Direction now depends on one factor: stability in oil flows. Areas of focus:
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Keeping Brent crude above or below the $100–$105 range
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Developments in the US-Iran negotiations
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Real movement of tankers through the Strait of Hormuz
April reflected the climactic blow. May will show whether markets stabilize or remain under pressure, while the June price will more fully reflect the recent recovery of the oil market.
Justin is a seasoned personal finance author and 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 confidently navigate today’s economy. Before returning to his Middle Eastern roots, where he was born and raised, Justin worked as a business correspondent at Reuters, reporting on stocks and economic trends in both the Middle East and Asia-Pacific regions.
