A major downfall in oil prices is forcing the UAE to drop their oil prices to fall inline with the rest of the GCC countries, as recent proposals in Abu Dhabi (City of the United Arab Emirates) surfaced to ensure that fair pricing for petrol and fuel will make it to the cabinet.
Al Mazroui responded to a member of the Federal National Council demanding to cut petrol prices saying – “Last month the ministry launched a study and will soon submit proposals to the Cabinet to enable consumers to benefit from low oil prices”
This is all inline with trying to maintain the country from falling into what could be one of the biggest recessions to hit the GCC, since Opec and Saudi Arabia are in cahoots – Saudi being the largest Oil exporter in the world, is not showing any signs of breaking down under pressure to reduce and follow the tide.
It won’t actually hurt countries like Saudi Arabia, Kuwait and the United Arab Emirates if they would reduce oil prices for several years since the have considerably large foreign currency reserves to back them up. Petrol retailers have been losing money in the past ten years with Adnoc alone losing more than Dh6.4 billion in 2014. Since oil prices fell to their lowest in 2009 after the global economic recession, and then considerably raising the price in the coming years which in turn affected the consumer, and resulted in a petrol price hurricane.
Be prepared to see a significant price reduction that could see oil prices to drop by up to 60% in UAE, while other opec member like Iran and Nigeria suffer to create economic balance due to their large population size.