Petrol falls in price but diesel rises again ahead of vat increase on Jan 1st

 The price of a litre of petrol has again fallen slightly at the pumps in the last month but diesel prices have continued their upward trend according to the December survey of pump prices from the AA. A litre of petrol now costs an average of 147.9 cent, down 1.6 cent since November. Diesel rose by 2.2 cent and now costs an average of 146.9.

 These changes include the addition of extra Carbon Tax in the budget which added 1.4 cent to petrol and 1.6 cent to diesel respectively. The additional 2% in VAT that comes into effect on 1st January will add 2.44 cent to petrol and 2.33 cent to diesel.

 “The policy of ever increasing fuel taxes was pursued by the last government and continued by this one.” Says Director of Policy Conor Faughnan. “We have now had five separate tax increases on fuel since October of 2008. Between them they have added 21 cent to the price of a litre of petrol.”

 An average car doing 12,000 miles per year and achieving 30 miles per gallon uses 1,800 litres of fuel in a year. That now costs €2,662 which is a major part of the cost of living for almost every family in the country. Of that figure, €1,576 is tax. The tax increases of the last three years have increased that figure by €378. Without them a litre of petrol would cost €1.29.

While oil prices have moderated slightly in the last weeks and is now down to $105 per barrel, the euro has weakened at the same time and the net effect has been minimal. The AA also notes the continuing rise of diesel prices, separate from petrol. This is happening across Europe and affects not only diesel car users but also freight, transport and haulage costs.

“The price of oil and the price of diesel is a serious impediment to Irish businesses as well as draining money out of the motorists’ pocket.” Says Faughnan. “That is happening because of market forces but unfortunately our own governments, the last one and now their successors as well, have made it much worse. Ultimately that is not a progressive strategy.”

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Note: The AA’s Fuel Saving Tips.

  • Buy fuel in units of litres, not euros. This makes it obvious where you get the best value
  • Shop around: don’t always use the same garage out of habit
  • Drive smoothly and slowly; a harsh driving style burns more fuel
  • At this time of year the heaters are in constant use. This is hard to avoid but try to take it easy: Air conditioners can add up to 10% to fuel usage.
  • Service the car if it needs it – it will certainly save you fuel. AA Members can have their car serviced on their own doorstep (or anywhere else) by its mobile Service Team.
  • A simple tip: check that the tyres are properly inflated. Soft tyres add significantly to fuel consumption.

Full details of the AA fuel price survey for May along with previous months for comparison are available on the Association’s website at http://www.aaireland.ie/AA/Motoring-advice/Petrol-Prices.aspx .