Rising tensions between Iran and the United States are starting to impact global energy markets. Oil prices across the Gulf region have increased sharply, moving above both global benchmark prices and U.S. crude prices.
One of the biggest movers is Murban crude, the main crude oil exported by the UAE. Because Murban is widely used as a regional pricing reference, changes in its price often reflect broader trends in the Gulf oil market.
As concerns grow about shipping routes near the Strait of Hormuz, traders are adding a risk premium to Gulf-produced crude.
Gulf Crude Prices Climb Across Multiple Grades
During trading sessions on March 5–6, several Gulf crude grades experienced strong price increases as supply concerns grew.
Murban crude reached a Government Selling Price (GSP) of $112.55 per barrel, making it one of the highest-priced crude grades in the market.
Other UAE crude grades also saw price increases:
- Lower Zakum: $112.55 per barrel
- Umm Shaif: $112.05 per barrel
- Upper Zakum: $108.90 per barrel
The price surge was not limited to the UAE. Other Gulf crude grades also moved higher:
- Oman Crude: $100.31 per barrel for May delivery
- Kuwait Export Crude: Jumped $8.57 in one session to $98.48 per barrel
Energy traders say these price increases show that the market is adding what is often called a “Hormuz risk premium.” This means oil produced in the Gulf becomes more expensive when there are concerns about shipping disruptions in the region.
Why Oil Prices in the Gulf Are Rising
A major reason for the price increase is concern about the Strait of Hormuz, one of the world’s most important oil shipping routes. Nearly 20 million barrels of oil pass through the strait every day, representing about 20% of global oil supply.
When tensions rise in this region, traders often increase prices to reflect the risk of possible supply disruptions. Even though Murban crude is trading at a premium because of its quality and location, analysts say the risk factor is now affecting almost all crude grades produced inside the Gulf.
Concerns grew further after comments from Qatar’s Energy Minister Saad Al-Kaabi, who warned that Gulf exporters could stop production within days if oil tankers cannot pass safely through the Strait of Hormuz.
This statement encouraged refiners in Asia — especially in countries like Japan and South Korea — to secure additional crude supplies quickly, which added more pressure to oil prices.
Market Signals Show Growing Pressure in Gulf Oil Trade
Several market indicators show that the Gulf oil market is becoming tighter. One important signal is the Dubai cash premium, which is the extra amount refiners pay above the official crude price to secure immediate physical oil supplies.
On March 5, the Dubai cash premium rose to $19.63 per barrel, the highest level recorded since tracking began in 2018.
Energy market analysts believe this increase shows growing concerns that crude shipments could become delayed or restricted inside the Gulf region.
In some cases, buyers are paying higher prices for oil cargoes that are already outside the region or guaranteed to reach their destination without disruption.
Recent Fuel Price Trends in the UAE
Fuel prices in the UAE have already seen several fluctuations over the past year. During mid-2025, petrol and diesel prices increased steadily and reached their peak around October. Prices then declined toward the end of the year and dropped further in January 2026, offering temporary relief to drivers.
However, if current oil market conditions continue and Gulf crude prices remain high through March, the next monthly fuel price review in the UAE could result in higher pump prices.
Retail fuel prices usually change more slowly because they follow a monthly pricing system. Final petrol and diesel prices are announced by the UAE Fuel Price Committee, and the official rates may change depending on global oil market conditions before the announcement date.
Also Read: Strait of Hormuz: Current Status & Statistics
Editor-at-Large
A passionate writer in the lubricant industry, Awais Iqbal has been covering oils, greases, and industrial fluids since the start of his career. At 25, he’s already written for blogs, catalogs, and brand guides across the UAE. Awais’s insights help companies connect with their audience, and his clear, helpful writing style is trusted by brands in the region.
