As motorists across the UAE await the March 2026 fuel price announcement, global oil markets are sending mixed signals. February brought some relief at the pumps, but a sharp rebound in crude oil prices, driven largely by renewed tensions between the United States and Iran, raises the possibility that March will reverse that trend.According to Khaleej Times, fuel became cheaper again in February. The prices of Super 98, Special 95 and E-Plus 91 were reduced by about eight to nine fils per liter, reaching 2.45 dirhams, 2.33 dirhams and 2.26 dirhams, respectively. This represents the second consecutive monthly reduction since December. Diesel prices were also revised down.However, the global oil picture has changed.Khaleej Times reported that Brent crude oil exceeded $71 per barrel during the month of February amid fears of a possible military conflict between the United States and Iran.
By Tuesday evening, Brent crude and WTI were trading at $66.31 and $71.38 per barrel, respectively. Brent crude’s closing price averaged $68.9 per barrel in February, compared to $63.47 the previous month.Energy analysts say that geopolitics now strongly controls market sentiment.S&P Global’s Daniel Yergin noted that oil currently carries a “premium” of about $10 linked to uncertainty surrounding tensions between the US and Iran, with Brent crude reaching $72.33 on February 23.
Norbert Röcker, head of economics and next generation research at Julius Baer, said the US-Iranian conflict is dominating the oil market and prices are inflated by what he described as a “decent geopolitical risk premium.”He added: “A military clash appears inevitable, but such escalation does not necessarily come hand in hand with an interruption in oil supplies, as the past years have shown on multiple occasions. Most importantly, today’s oil market has great flexibility of supply, thanks to abundant storage, production exceeding consumption, and spare production capacity.”He added: “Although we are uncertain whether the current bounce will reach the highs of $70 or $80, we have more confidence in the view that the risk premium will diminish and oil prices will return to below $60 mid-year. Under today’s geopolitical conditions, we maintain our neutral view.”Meanwhile, insurance premiums for ships passing through the Strait of Hormuz rose after Tehran temporarily closed the strait for several hours, according to previous reports by Khaleej Times.
The waterway is an important artery for global energy flows.“Oil markets have also returned to focus as tensions intensify in the Middle East,” said Daniela Hathorne, senior market analyst at Capital.com. “Brent crude oil moved above $70, supported by rising geopolitical risks. Iran’s strategic location near the Strait of Hormuz, through which nearly 20 percent of global oil supplies flow, means that any disruption could have serious consequences.”The UAE reviews petrol and diesel prices monthly, based on average global oil prices and refined fuel costs in the previous month. When the price of crude oil rises, pump prices tend to follow; When it falls, motorists usually get relief.With Brent crude averaging higher in February than in January, and geopolitical risks continuing to escalate, March prices may not provide the same stimulus they enjoyed last month.
