How to Start an Oil Trading Business in Dubai?
Dubai owes much of its growth and prosperity to the discovery of oil. Without oil, the city would not have transformed from a small village into the vibrant metropolis it is today with a short span of time. Oil accounts for over 60% of the United Arab Emirates GDP. Although the oil industry in the UAE is highly regulated, there are numerous opportunities for entrepreneurs to benefit from this precious resource. One profitable option is to start an oil trading business in Dubai.
Oil and gas trading business Dubai is one of the most lucrative business sectors in the UAE. Numerous countries including India, China, and the whole of Asia import crude oil from the UAE. Also, you can export oil and gas to the rest of the world from UAE. If you want to set up or start an oil trading business in Dubai, then you are at the right place.
Starting an oil trading business in Dubai offers the opportunity to trade and profit from oil commodities. As an industry is subject to regulations, there are many steps you need to navigate when setting up as an oil trader. With right support and guidance, you can swiftly establish your business and commence operations within a few weeks.
Benefits of Starting an Oil Trading Business in Dubai
Strategic location
Earn huge profits
Trade across the globe
Low-income corporate and custom tax rates
Undertake any commercial activity involving UAE oil reserves
Easy company setup process
Consistent support from the government
Excellent Networking opportunities
Complete repatriation of capital and profits
Steps to Start an Oil Business in Dubai
The oil company setup process is incredibly straightforward in Dubai. You can seek the guidance of a professional business setup agency like Bizvise. If you follow the below mentioned steps, you can establish your oil business in a successfully.
1. Gain Knowledge about the Oil Market
To understand the oil market, you must know about oil option and oil futures. Oil futures are contracts through which a trader agrees to exchange a set amount of oil at a specific price on a set date. It is a commonly used method of selling and buying oil in the country, and you can contract them on futures exchanges. Oil futures trade on exchanges and can start them in the form of oil benchmarks. Oil option is similar to oil futures, but there is one difference. You can buy a set amount of oil before a set date at a fixed price with an oil option. Apart from that, there is no hard and fast rule to trade if you don’t need to.
2. Choose the Way of Trading
Decide whether you want to trade through CFDs, buy futures or options, make an oil investment or open your company in Dubai.
3. Select a Jurisdiction
There are over 25 active free zones and a mainland region in Dubai for your company setup. Both the locations have their own set of advantages and regulations. So, you must weigh all the pros and cons and then choose the jurisdiction to set up your business.
4. Make a Clear Business Plan
It is necessary to have a comprehensive business plan to start oil trading in Dubai. Some legal authorities may ask you to present your business plan. It must include:
Markets
Employee number
Products you want to sell
Information about official operating space
Investing amount
Details of business partners and financing
Competitors
Suppliers list
5. Choose a Business Name
Choose a business name and register it with the concerned legal department. Before you finalize, make sure it complies with all the set naming rules set by the government. It must not include any foul words or references to Allah or any other religion. Also, if you want to name it after a person, use the full name.
6. Complete License Application Process
You can either go for a commercial license or a general trading license which costs. The general trading license allows you to trade in the broader area. Once you have chosen, apply for your trade license offline with the concerned legal body. Submit the application form along with all the documents attached to it. Also, your application will undergo an inspection process. After thorough check, the government officials will grant you the trade license. This process may take around 3 to 4 working days to complete.
7. Obtain Additional Approvals
After receiving your license, you must get additional approvals. Depending upon the nature of your business and the business activities you choose, you need to obtain approval from the Supreme Petroleum Council (SPC).
8. Open a Corporate Bank Account
Once you have completed with all the legal formalities, you must open a corporate bank account in Dubai. This will help conduct financial transactions in a transparent manner.
Documents Needed for Starting an Oil Trading Business in Dubai
To set up an oil trading business in Dubai, you have to submit a few essential documents:
1. Passports Copies: Offer copies of passports for all individuals involved in the business, such as shareholders, directors, and partners.
2. Passport-Size Photos: Recent passport-size photographs of the individuals associated with the business
3. Entry Visa or Stamp Page Copy: Submit a copy of the entry visa or stamp page for very individual involved in the business.
In conclusion, starting an oil trading business in Dubai offers huge opportunities given the city's strategic location and business-friendly environment. By conducting thorough market research, developing a clear business plan, choosing the proper business structure, and ensuring compliance with regulations, entrepreneurs can establish an oil trading business. With careful planning and guidance of a professional agency, an oil trading business in Dubai can thrive in the competitive global market.
Seeking the Help of a Professional Business Setup Agency?
The experts at Bizvise have years of experience in helping entrepreneurs starting businesses all over the UAE. With our services, you can go for a great start and hit the ground running. Bizvise has a team of experts who are knowledgeable about the oil industry and market dynamics. We can guide you throughout the process, including choosing the ideal location and providing advice on trading options. Consulting with experts like us will ensure a proper journey and increase your chances of success.
Take the first step today and contact us for any professional assistance!