Abu Dhabi - Arabstoday
Billions of dirhams have been pumped into petrol products retailer Emarat, the UAE\'s official news agency WAM reported on Tuesday. The company, also known as Emirates General Petroleum Corporation, has had its capital increased by 50 per cent to Dh9 billion. The move was authorised by His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, after a federal cabinet meeting yesterday. It comes amid an ongoing fuel shortage at petrol stations, including Emarat-run filling points, in the emirate of Sharjah and some other northern emirates. \"This will allow the banks lending to Emarat to increase their ceiling on loans to Emarat. Emarat had crossed its previous limit. Today\'s development means Emarat will now get bank loans up to Dh9 billion,\" a local oil industry source told Gulf News. \"This is a lot of money... it will go for years,\" he added. The UAE state oil marketing companies are losing up to an estimated Dh16.5 million a day on petrol sales as the difference between state-set prices and the cost of imports increases. The petrol grade which sells at Dh1.72 a litre in the UAE must be sold at close to Dh3.10 a litre to reflect its true market price. As matters stand, the oil retailers are losing around Dh6.50 for every gallon of petrol sold. The country\'s petrol consumption is estimated to be slightly higher than 5 million litres per day. The current domestic price of petrol reflects international crude oil prices at about $55 a barrel, even though Brent crude oil futures yesterday on the ICE Futures exchange in London traded at $105 (Dh385) per barrel. The four UAE oil retailers — Adnoc Distribution, Enoc, Eppco and Emarat — are paid by the government to cover the cost of subsidies. Adnoc Distribution\'s subsidies are directly borne by the Abu Dhabi National Oil Company, while Emarat\'s operating budget is approved by the Ministry of Finance with additional subsidies borne by the Abu Dhabi government. The cost of Enoc and Eppco\'s subsidies is borne by the Dubai Government. While the government allowed petrol prices to be revised twice last year, this year there has seen no revision despite sharp rises in international crude and oil product prices. The state oil firms cannot unilaterally revise pump prices without the federal government\'s approval.