The United Arab Emirates (UAE) is one of the energy producers worldwide as well as the 4th largest and biggest crude oil exporter with natural gas reserves.
This amazing oil record of the UAE has attracted successful industries in the region through which the Dubai government generates more revenue to sustain the country’s economy.
Although the sales of oil products are highly restrained in the UAE, there are a bunch of other ways for entrepreneurs like you to benefit from these resources which are by operating as an oil trader.
And guess what?
As oil happened to be a popular commodity in the region, and the demand was so high. The oil trading business in UAE has become a great idea for entrepreneurs like you to generate massive revenues.
So if you want to partake in this oil-developing market in Dubai, then read on to learn more.
This article will expose you to how to start an oil trading business in UAE and will furthermore revealing the benefits of trading oil in the region.
Let’s get started.
What does the oil trading business mean?
This simply means the act of doing some business activities that involve the oil and gas markets.
Since the oil and gas industry is rapidly becoming a booming economy with unsteady market prices in Dubai, lots of diverse entrepreneurs plan to start this business.
If you have the right knowledge and understanding of the oil industry, starting up an oil trading business shouldn’t be too hard for you.
But let’s see how to get started.
How to start an oil trading business in UAE?
Well, to start an oil business in the Emirates is not a walk in the park but not impossible, though.
With the right step-by-step guides we list here, you can start the process with ease and achieve success at the end.
Below are what to do to start an oil trading business in UAE.
- Get a business trading license.
- Know the oil market.
- Set a business plan or strategy.
- Choose a brand new name.
- Select the best location.
- Get a Memorandum of Association.
- Launch a corporate bank account.
- Get approval from the Supreme Petroleum Council (SPC).
Let’s further discuss these points for easy understanding.
Get a business trading license
When you want to start any kind of business in UAE including the oil trading business, this is the most vital document you need to have at hand.
A trading license is what allows you to operate your business in the region without incurring any government bumps in the future.
All you need to do is to register with the appropriate authorities and fulfill their requirements and they will present your trading license to you within a few days.
Know the oil market
Having a good knowledge and understanding of the oil market will help you excel in the oil and gas industry doing the oil trading business.
Starting an oil business is not a walk in the park and therefore required a proper study and research of the market, how it works as well as how to run a successful oil trading business.
If not, you may want to opt out when the going gets tough.
Set a business plan or strategy
Another important thing you need to do when you are ready to start an oil trading business in UAE is to draft a business plan.
This should state how you are going to run your business, your business activities, and ways to trade.
Your business activities could be:
- Drilling oil
- Construction
- Oil equipment trading
- Associated oil and gas or any of the related activities.
You should also decide on ways to trade – you can choose whether to open an oil company, be involved in the oil investment trade, or decide to trade through the CFDs.
A business plan includes:
- Several employees
- How much do you pay each of them?
- The financial aspect of the business
- Your day-to-day basis operations, etc.
When you have a well-structured business plan to operate your business, it will help you to focus more on achieving your goals.
Choose a brand-new name
Once you have outlined your business plan, your next move is to choose a brand-new name for your oil trading business.
However, whichever name you decide to go with, ensure it is not the initial of your name, and shouldn’t in any way go against the UAE regulations to avoid attracting denials from the Dubai government.
Select the best location
There are lots of good spots to set up your firm in the Emirates.
You can choose either the Mainland, Offshore or Free zone areas. All of them have their advantages, so you need to go for a good site that suits your business and where you can trade with a relaxed mind.
Get a Memorandum of Association
If you plan how to start an oil trading business in UAE, ensure to get a certificate of Association from the appropriate Authority.
You have to register with the Ministry of Human Resources and Emiratisation (MOHRE) and other authorities before you can be part of the developing market in Dubai.
Launch a corporate bank account
Starting any business in UAE requires you to open a corporate bank account for easy transactions between you and your customers.
Opening a bank account in the region is quite easy and doesn’t need many rules and regulations.
All you have to provide are some documents such as:
- Your copies of your passports and that of your sponsors, if any.
- 2 color passport photos.
- Your residency visa, etc.
So you must get all these beforehand to make your journey faster and more straightforward.
Get approval from the Supreme Petroleum Council (SPC)
Aside from getting your trading license, and getting a Memorandum of Association, another crucial thing to do is get approval from the Supreme Petroleum Council (SPC).
After you must have submitted all the needed documents, they will present a certificate of approval that gives you the right and freedom to set up and operate your business in any location of your choice in UAE without issues.
That being said, know that having to go through all these processes requires a lot of energy and hard work. And as such, we suggest you seek support from professional business consultants like Masar AI Ameen – they help manage the business setup process for entrepreneurs who wish to start their businesses or companies in the UAE, ensure your trading license is approved faster, and assist till you are fit to trade.
Now let’s look at the pros of having the opportunity to trade in the Emirates.
5 benefits of starting an oil trading business in UAE
It’s important to take note of the benefits that come with setting up an oil trading business in the UAE.
The following are the usefulness:
- It’s affordable and straightforward to start an oil firm in Dubai.
- There are no currency restrictions.
- You have government support, enjoy great trade routes, and have the freedom to trade either on the Mainland or Free zone without duress.
- You can also partake in any commercial activity about UAE oil reserves with no corporate taxes attached.
- Since oil is now a popular commodity in UAE, establishing an oil business there could generate a lot of profits and revenue for you.
In conclusion
Starting up an oil trading business in UAE isn’t difficult if you have the knowledge or learn about the oil industry and have a detailed business plan.
As mentioned above, oil is a popular commodity in UAE with demand so high. Hence making an oil business is a great idea to generate massive revenues.
Having understood how to start an oil trading business in UAE and its benefits, it’s essential to note that the application process can be achieved only when you provide the right documents and applications without errors.
However, to ensure you don’t waste your time or face lots of bumps and rejections during this process of setting up an oil trade, you are advised to work with an experienced company and business formation Masar AI Ameen – is a team of company registration specialists, highly equipped with the right information to assist entrepreneurs like you who strive to run an oil and gas business in Dubai, with their support, you can start-up your company within few days.
Hope this information here helps you when you want to start the process soon.
When do you intend to start?
Good luck with starting your new business!
Read more about how to set up a Consultancy Business in the UAE.
