UAE fuel prices for May 2026: Will it rise or fall sharply after Iran ceasefire?

Dubai: UAE motorists are unlikely to see a sharp drop in fuel prices in May, even as global oil markets ease from March’s peak.

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Crude has pulled back—but not enough to signal a full correction.

• Brent crude is now trading close to $99.29 per barrel, up 0.82% on the day

• US crude stands at $90.71, rising 1.15%

• Both benchmarks gained around 3% in the previous session, showing renewed upward pressure

This follows a period where oil surged above $110–$120 in March, before easing into the current $90–$100 range.

How UAE fuel costs will change

The UAE sets fuel prices based on the average oil price over the previous month. That creates a lag effect:

• April prices reflected March’s sharp spike

• May prices will reflect April’s lower—but still elevated—average

Likely direction for May:

• Petrol prices: stable or slightly lower

• Diesel: likely to remain elevated

• Overall trend: no repeat of April surge, but limited relief

In short, the market is shifting from crisis pricing to stabilisation, not a full reset or reversal.

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Why prices are not falling faster

Oil may have cooled from its peak, but underlying risks remain firmly in place.

• The Strait of Hormuz remains constrained, with minimal vessel movement reported

• Around 20% of global energy supplies pass through this route

• A continued naval blockade is limiting supply flows

At the same time:

• The US has indefinitely extended a ceasefire with Iran to allow negotiations

• Markets remain cautious, pricing in uncertainty rather than resolution

• Oil prices have already started edging higher again toward the $100 mark

This combination—partial de-escalation but ongoing disruption—is keeping prices supported.

What happens after a spike

Past UAE pricing cycles show a consistent pattern:

• Sharp increases are usually followed by partial pullbacks, not immediate reversals

• Prices tend to stabilise over one to two months before a clearer trend emerges

• Diesel often lags on the downside due to tighter global supply

That suggests May is more likely to be a holding phase, rather than a correction.

Scenarios for May fuel prices

Most likely prices:

• Oil fluctuates between $90–$100

• UAE prices hold steady or edge slightly lower

When can costs rise:

• Supply disruptions persist or worsen

• Oil moves back above $100

• UAE prices remain elevated

When can costs drop:

• Strait of Hormuz reopens more fully

• Supply normalises

• Price relief becomes more visible in June rather than May

What motorists should watch

The direction is now tied to one variable: stability in global oil flows. So the focus will be on:

• Movement in Brent crude around the $90–$100 range

• Developments in US-Iran negotiations

• Shipping activity through the Strait of Hormuz

April reflected the peak of disruption. May will show whether markets are stabilising—or preparing for another move higher.