Fuel Prices rise again for first time in 4 months

The price of petrol and diesel has crept upwards at the pumps for the first time since last September, according to the latest survey of prices from the AA. A litre of petrol now costs an average of 159.4 cent, up 1.5 cent since January. A litre of diesel costs 153.7 cent, up 2.9 cent on the figure for January.

Prices peaked in September at over €1.70 per litre. That was a very unwelcome high-water mark and was the most expensive that fuel has ever been in Ireland. Since then prices have been falling gradually, and with the relative strength of the Euro against the dollar we have seen a reduction in pump prices here.

“2012 was an appalling year for fuel prices, the worst we have ever had.” Says Director of Consumer Affairs Conor Faughnan. “It was the number one issue for motorists last year. This was why we were so strong in our arguments to government not to increase fuel taxes even more in the December budget. We succeeded in persuading them, although they did increase car tax which was frustrating.”

The price of oil on world markets has been relatively stable in recent weeks. The price for Brent Crude has crept upwards from just over $110 per barrel at the start of the year to $118 now. Irish consumers did not really feel this initially because the Euro crept upwards against the US dollar at the same time.

“Internationally, it is hard to fathom the reasons for a rise right now.” Says Faughnan. “Forecasts for oil demand in 2013 are quite weak, mirroring economic data, and we even had a relatively mild winter. For the price of fuel to be rising now is surprising and very disappointing.”

The AA points out that the key reason for high prices continues to be high taxes.  55% of the retail price of petrol is tax. Various tax increases since October 2008 have added 23 cent per litre to the retail price of petrol.

For a typical motorist* that means paying €240 for fuel every month of which €131.50 is tax. In a year a typical Irish motorist will pay nearly €1,600 in tax on fuel.

“We cannot sustain another year like last year.” Says Faughnan. “The year was one long fuel crisis for consumers as the government stayed deaf to their calls. It did not get worse in the budget but it did not get better either. The government will have to be more responsive this year or they will hurt ordinary motorists and they will hurt the economy.”

ENDS

*If a car does 12,000 miles per year (19,200 kms) at a fuel consumption rate of 30 miles per gallon (9.42 litres per 100 kms) that car will use 150 litres of fuel per month.