Oil prices rose on Tuesday as more evidence emerged that crude exports from Iran, OPEC’s third-largest producer, are declining before the imposition of new US sanctions and as a hurricane moved across the Gulf of Mexico.

Benchmark Brent crude was up 55 cents at $84.46 a barrel by 0730 GMT, having fallen as low as $82.66 on Monday. Brent hit a four-year high of $86.74 last week. US light crude was up 45 cents at $74.74.

Analysts are expecting prices to continue rising this year and while this could mean higher petrol costs for consumers, the trend will be beneficial to the UAE or Gulf economies.

Higher oil prices could boost consumer confidence in the region and ultimately result in the creation of more jobs and push workers’ salaries higher.

According to M.R. Raghu, executive vice president for Kuwait Financial Centre “Markaz,” the continued rise in oil prices will have a positive impact on the economies in the Gulf, including the UAE.

“Higher oil prices will increase the consumer confidence as it would signal better revenue visibility for the governments,” Raghu told Gulf News.
“The governments have already announced expansionary budgets and this would trickle down in the form of better salaries and job prospects.”