A golden era for the UAE’s oil trading sector has drawn to a close as a tightening of US sanctions on Russian and Iranian barrels, regional geopolitical shifts and broader industry headwinds combined to create a highly challenging year for Dubai-based trading firms in 2025. This year is unlikely to prove any easier for independent firms, with the traditional trading giants and NOC-backed firms consolidating their control.
The first half of the decade was transformative for the United Arab Emirates, and Dubai in particular, as an oil trading hub. The Covid-induced price contango that incentivized oil storage caused storage tanks at hubs such as Fujairah to fill up, with tankage prices spiking as a result (MEES, 2 May 2020). The market upheaval caused by Russia’s 2022 invasion of Ukraine pushed price structures into a strong backwardation but the displacement of Russian barrels from Europe into East of Suez markets led to a surge in flows of new volumes into UAE hubs. An exodus of firms trading Russian barrels from Europe to Dubai further transformed the trading ecosystem (MEES, 23 September 2022). (CONTINUED - 1047 WORDS)
