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Grin and bear it. Or just bear it.

Grin and bear it. Or just bear it.

Prices of water, electricity, and oil are on the rise. Kipp (for once) is staying positive on this one – after all, we’ve had it far too easy, far too long.

December 10, 2010 2:32 by



When Kipp thought about beginning a blog on the fact prices are rising in the UAE, we couldn’t think of a more apt way of starting it than by quoting the headline of a recent article in Emirates 24/7: “UAE housewives in tears as onion prices soar.”

We’ll just give you a second to appreciate the brilliance…

Housewives, we are sure, will not be the only ones in tears over prices this weekend as the media reports that Dubai’s water and electricity tariffs are rising, and once again there’s a potential increase in the price of petrol at the pumps across the UAE.

Emirates 24/7 reported the potential double whammy with headlines that pale in comparison to the ‘housewives in tears’ one, much to our disappointment. According to their calculations, petrol prices are likely to increase by Dh1 per liter if distributors are serious about getting on par with international prices. In the current year, local retailers have already increased fuel prices by 35 fils; but even with those increases prices are well short of the benchmarked price of gasoline globally. And the international price is set to go up further still. Dalton Garis, Assistant Professor of Economics and Petroleum Markets Behaviour at the Petroleum Institute in Abu Dhabi told the website, “I suspect oil will be at around $110/b by this time next year.”

That rather gloomy outlook comes just as DEWA confirms a 15 percent increase in utilities fees. According to Gulf News, “The current slab tariff of water consumption for residential sector for non-national will be moved from 3 fils to 3.5 fils per gallon up to the consumption of 6,000 gallon, and from 3.5 fils to 4 fils per gallon for above 6,000 gallon and up to 12,000 gallon, and from 4 fils to 4.6 fils per gallon for usage above this level every month.”

The culprit is, of course, rising supply prices. Nejib Zaafrani, Secretary-General and Chief Executive Officer, Supreme Council of Energy in Dubai, told Gulf News there will be “additional fuel surcharge or a reduction in the value of monthly consumption bills to correspond with future increase or decrease in the cost of imported fuel. Additional fuel surcharge will be shown separately in electricity and water consumption bills.” Expect more surcharges than reductions, thinks Kipp.

We never welcome an increase in prices, particularly in vital products, and the knock-on inflationary effects are going to hurt. But by now we’ve pretty much made peace with the news, and we reckon everyone else should too. After all, fuel prices in the region are still significantly lower than in other parts of the world, and so too are many of the costs of living. Plus rents are still falling, which is making life far more bearable for many. And of course, the tax thing is still pretty nice.

No, the bottom line is we’ve probably all had it far too cheap for far too long; in fact it almost feels like we’ve been carrying around a guilty little secret, and now we have been found out.

So expats, we’re afraid that on this our luck has run out. Times are hard, we’ve just got to live with it.



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