The country's fuel prices have reached “record levels” as petrol overtakes diesel as the most expensive fuel, and hauliers are demanding the Government declare a fuel 'emergency'.
Across the country, petrol prices have risen above €2 per litre, with some filling stations charging as much as €2.15. Diesel remains on average around €1.95 per litre.
“We are now, on average, at record prices,” said Paddy Comyn, a spokesman for the AA. He warned that because of the Russian invasion of Ukraine, “you can comfortably predict that 2022 will have the highest average prices [for fuel]”.
It will cost at least €500 more to run a car this year than previously, he said. And he warned that the impact of soaring fuel costs will be more strongly felt among those living in rural Ireland without access to public transport.
Meanwhile, hauliers say it is “wartime” for their industry as costs have risen by 30% in the last six months. Eugene Drennan, president of the Irish Road Haulage Association (IRHA) warned “there won’t be any profit in any transport company this year” unless the Government acts to further assist the industry.
Mr Drennan wants the Government to declare an emergency as fuel price increases are affecting the viability of the haulage sector and increasing distribution costs that affect the price of everyday goods.
Although the Government is currently subsidising hauliers €100 per truck, per week, Mr Drennan said this isn’t enough. The IRHA is to meet with the Department of Transport next week to seek further financial supports “immediately”.
Fuel prices in Ireland have risen month-on-month since June 2020, according to figures compiled by the AA.
“At one stage during Covid, prices for oil were $15 per barrel,” Mr Comyn said. “Now it’s $120. But the tax in Ireland keeps the price high no matter what. Nobody really reaped the benefit of it.”
Petrol v renewables
In the last week, petrol has become more expensive than diesel for two main reasons. According to AA, almost 35 million people in the US began long journeys during Memorial Day weekend at the end of May. With most cars using petrol in the US, the global impact reached Ireland and contributed to price increases.
Additionally, fuel traders are understood to have underestimated the impact of the Russian invasion of Ukraine on petrol prices, leading to the subsequent increase in cost. The EU decision to phase out 90% of Russian oil imports into the bloc by the end of the year is also expected to have a further impact on prices.
Kevin McPartlan, chief executive of Fuels For Ireland, hopes the price increases will encourage consumers to use renewable fuels, but doubts this will have an impact on Ireland’s carbon neutrality goals.
He argued that due to “deliberate policies” in Western Europe and the US that reduce the capacity to produce fossil fuels and increase their prices through tax, prices have increased significantly in recent years. Tax on fuel in Ireland amounts to 52% of the price for petrol and 46% for fuel, two-thirds of which is excise duty and one third is Vat.
Although such policies have been designed to discourage the use of fossil fuels, there are “decades of evidence to prove it’s never worked”, he said. “Because all the time that those prices have been increasing and our capacity to produce fuels has been decreasing, consumption has still been increasing. It’s never, ever worked.”
Mr McPartland said Ireland should discuss strengthening our energy security when reliance on Russia has proved problematic. He proposes “massive efforts” to increase domestic production of renewable energy in Ireland.