Diesel prices from the oil retailers – Emarat, Emirates National Oil Company (Enoc) and Emirates Petroleum Products Company (Eppco) – went up by another 75 fils with effect from yesterday as the oil marketing companies in Dubai increased diesel price to Dh19.25 per gallon from Dh18.50 to meet the high cost of oil in the international market.
Within eighteen months, diesel price in Dubai has gone up by almost two and a half times – from Dh8.35 per gallon in January 2007 to Dh 19.25 in June 2008.
Ghazi Marian, sales supervisor at Emarat Petrol Station, Al Bahara in Dubai told Emirates Business Emarat started selling diesel at Dh19.25 per gallon after receiving a circular from the head office.
"The diesel price increase is similar in Eppco and Enoc Petrol stations. There is no change in petrol prices. We were expecting this price increase for a week now," he said.
Senior Emarat, Enoc and Eppco officials were not available for comments about the price increase.
Abu Dhabi National Oil Company (Adnoc) , which sells diesel at a subsidised price of Dh8.60 per gallon will not change the prices, said company sources. Unlike Adnoc, which gets subsidised oil, the oil marketing companies, Emarat, Enoc and Eppco purchase oil from the international market at market rates.
Due to the huge difference in diesel price between Adnoc and other oil retailers, many trucks and heavy vehicles using diesel queue up in front of Adnoc petrol stations.
Traders expect more queues in front of Adnoc petrol stations because there is a huge difference in cost. Even by skipping one or two trips, drivers can save considerable amount, if they fill their tanks with Adnoc diesel.
Nanoo Viswanathan, general manager, Nashwan Land Transport, which operates 35 heavy trucks said: "A truck requires about 750 gallon diesel per month. The diesel price increase is one more blow to the transport industry. Now we will increase transport charges and shipping companies will increase their Bunker Adjustment Factor."
Construction companies will have to spend more on diesel that runs thousands of heavy vehicles, cranes and generators.
Diesel generators even power many labour accommodations in some remote areas of the emirate.