Dubai: The move to deregulate the prices of oil could lead to consumers spending more money not just on petrol, but on living costs. But the upside is that the economy will improve and ultimately, more jobs will be created.
Starting August 1, fuel subsidies will be removed and the prices of oil will be based on average global costs. The decision is aimed at reducing fuel consumption and supporting the national economy.
Mandagolathur Raghu, head of research at Kuwait Financial Centre (Markaz), said that fixing the prices of oil according to market forces will make consumers vulnerable to cost fluctuations. If global prices go up, the end result will be higher fuel prices in the local market. In turn, the rise in fuel can have trickle down effects on the overall cost of living.
The price of petrol in the UAE is one of the lowest in the world, but it is the highest in the Gulf Cooperation Council (GCC) region. Details