Families hit by €1,000 petrol hike bombshell
Pressure grows to cut or scrap taxes
Published 08/03/2011 | 05:00
HARD-pressed families are paying an extra €1,000 a year to run their cars as petrol prices spiral above the €1.50-a-litre mark at the pumps.
As the conflict in the Middle East continued to heap pressure on oil prices, motoring groups released figures which showed the huge spike in prices that has driven up costs over the past two years.
Based on average mileage, it now costs about €225 a month to run a normal family-size car -- €84 a month more than it did just 24 months ago, the Automobile Association (AA) has revealed.
The extra cost only covers fuel consumption and does not take into account other factors such as rising motor insurance premiums, increases in car tax, vehicle depreciation and servicing charges.
The price surge has put pressure on the incoming Government, with consumers and road hauliers demanding it temporarily scraps the carbon tax or cuts fuel taxes.
The added squeeze comes as consumers struggle with the rising cost of private health insurance cover, expected mortgage rate increases and the new universal social charge.
This time last year, a litre of unleaded petrol cost an average €1.27, but the cost soared beyond the €1.50 mark yesterday at many garages.
AA policy director Conor Faughnan said that while much of the increase had been caused by rising worldwide demand and trouble across the Middle East, taxes imposed by the outgoing Government had also added an extra 17c to a litre of petrol.
An 8c tax imposed in October 2008 was followed by a 5c carbon tax and a 4c increase in the December budget.
Mr Faughnan said the irony was that when oil was around $150 a barrel in 2008, motorists were paying around €1.35 a litre.
Now oil is costing $120 a barrel and motorists are paying €1.50 a litre -- thanks in part to government taxes.
"We are hoping that the incoming government will reduce tax on petrol and diesel and we will be calling on them to do so," said Mr Faughnan.
That call was backed last night by the Consumers' Association of Ireland (CAI), which urged the government to scrap the carbon tax as a temporary measure.
"These soaring costs are not only pushing up the price of petrol, but the transportation of goods will also go up everywhere," warned CAI chairman Michael Kilcoyne.
"The government is getting about 70pc of the cost of a litre of fuel in taxation and there is an obligation on them to do something about it."
Road hauliers were feeling the squeeze amid predictions that more operators will be forced off the road if the fuel price spiral continues.
Irish Road Haulage Association president Vincent Caulfield said it was costing hauliers up to €500 extra a week to keep their trucks on the road with each fill costing €200 more than it did 12 months ago.
"We are now hoping to meet the incoming Transport and Finance ministers to discuss this crisis," he said.
Petrol retailers said last night that while the price increases would undoubtedly hit sales, they had no choice but to pass on the hikes.
"When the price went to €1 a litre people were shocked but now this is another milestone," said Michael Griffin, chief executive of the Irish Petrol Retailers Association.
"It affects business in our shops and at the pumps and a lot of petrol stations have closed," he said.
Meanwhile, surging prices have sparked a dramatic increase in oil tank raids nationwide.
Gardai have now urged householders and businesses to be vigilant about their oil tanks.
A garda source estimated that there had been a 400pc increase in oil tank raids over the past five months triggered by spiralling oil prices.
Home heating oil and diesel are now much more valuable to thieves, with prices having soared by almost 30pc over the past few months.
The average cost to fill a 1,000-litre tank is now almost €840. Thefts have been reported in Dublin, Cork, Limerick, Tipperary and Laois -- with raiders using sophisticated equipment to siphon off the oil.