Fuel price hike will not trigger rise in prices

Suhail bin Faraj Mohammed Fares Al Mazrouei, Minister of Energy, has stressed that the rise in fuel prices in the UAE after liberalisation of prices will not cause a huge shock, as diesel prices will fall from current levels, a move that will boost the country's economy.

He told Al Arabiya TV channel in an interview over the phone that the decline in diesel prices will stimulate the economy and will not trigger a rise in the prices of goods and services as rumoured by some, but he noted that the increase would be minimal.

The minister explained that the role of the committee formed to determine the price of fuel on a monthly basis is to ensure that the consumer gets a fair price and that "few of us know what one pays for fuel."

He added that if the increment is around 10 to 40 per cent, it will not certainly reach 40 per cent. The increment will not equal the price of a lunch.

He stressed that post-liberalisation prices would not be too different from their current levels.

And whether lower diesel prices would reflect on the prices of goods in the country, the minister said, "We have the Consumer Protection Authority and the Ministry of Economy which have a role regarding the issue. We have also talked with the heads of Contractors Associations who said that the price of diesel represents 90 per cent of the cost and any decline will reduce the prices."

The minister said, "We are fixing our economy to be able to sustain economic development," and added that expatriates own 380,000 cars, while citizens own 400,000 of them.

About calculating the price of fuel on a monthly basis, he said, "We take into account price average, operation cost, including transport and profit margin in accordance to the international prices and in the best interests of the consumer."

Follow Emirates 24|7 on Google News.