Wednesday 21 August 2019

Focus on rising fuel prices

Drivers blame retailers, and retailers blame wholesalers, who in turn blame the war in Libya. This week, our reporters around the county look at the spiralling cost of fuel on our forecourts

AS the price of petrol and diesel rockets at local filling stations, Transport Minister Leo Varadkar has been urged to listen to his own advice and implement a policy to reduce fuel prices.

Conor Faughnan, Policy Director at AA Ireland, said that the major contributing factor to the record price of petrol and diesel at the pumps is our 'super high taxes' on fuel, but that the Minister has a ready-made solution - one he drafted himself when Fine Gael were in opposition.

'We've seen a huge surge in petrol prices since last November. They have just gone up and up and up,' said Mr Faughnan.

He said a lot of this is due to do with world oil prices rising, but it's mainly taxes applied by the previous Irish government.

'Oil prices are not at record levels. They were higher in 2008, but yet we are paying record prices for petrol and diesel. The simple reason for this is tax,' said Mr Faughnan.

He said that since October 2010 there has been excise duty increases of 8 cent and 4 cent respectively, with carbon tax lumped on top. Petrol would now be around the €1.32 mark per litre and not around the €1.50 mark without those three increases since October 2010, according to the AA.

Mr Faughnan said that around 57 per cent of the retail cost of tax is now comprised of our 'super-high taxes'.

The AA conducted a study showing that with a price of €1.50 a litre a family that has one car that gets 30 miles to the gallon and travels 12,000 miles a year will spend €225 a month on petrol.

However, Mr Faughnan acknowledged that this would actually be a great scenario for most families in the predominantly rural south east, who often have long distances to travel to work. As well as that, many families will have more than one car.

'Fuel costs are now one of the biggest bills, after the mortgage and food, that any household faces,' he said.

The AA is lobbying for reduced taxes and said they are not making Minister Varadkar's own argument to him.

'He produced a very intelligent policy document in opposition in relation to fuel price deflation,' said Mr Faughnan.

Essentially it related to using the extra VAT generated by increasing fuel prices to reduce the overall cost of petrol and diesel.

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