In the UAE, prices for steel and building materials fell due to cheap oil

Suppliers of steel and building materials in the UAE are reporting plummeting prices due to low oil prices. Local Groups state that they have a large stock of steel products and building materials in warehouses that were purchased at a higher price even before oil prices fell.

Abdullah Al Gurg, representing one of the Groups, said that “Oil was sold at $ 115 a barrel in June last year. Today it sells below $ 60 a barrel. Steel prices have fallen more than 30 percent since oil fell last year, and the situation will remain volatile. The fall in oil prices is deteriorating the business environment associated with the related production of the oil and gas industry, including asphalt, roofing materials, insulation, plastic and other materials. ”

He said that as long as there is no indication for an imminent rebound from a given price level, suppliers must adopt new strategies to survive. Businesses are in danger of going out of business. The KGSO Group has adopted a new strategy to protect this business segment and prepare the Group's steel division for growth in the coming years.

The oil and gas industry is cyclical in nature, and the market has adapted to similar cycles in the past and will change in line with the direction of demand. He added that "in the long term, we are confident in the attractiveness of the global oil and gas markets, and our strategies must provide the most innovative and competitive solutions until the market can pass its critical phase."



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