Rising prices will hit us hard after falls cushioned consumers
The shock of the sudden sharp rise in oil prices is all the greater because we have not been used to price increases recently. Quite the reverse. Over the past two years, Ireland experienced one of the biggest price collapses ever recorded.
Consumer prices dropped by more than 6pc in the year to the middle of July. Leaving aside mortgage costs, the prices of goods and services stopped falling only late last year. Even in January, they were just a fraction higher than a year before.
The rapid rise in oil prices may well change that picture in coming months. Petrol prices rose only 2pc in the 12 months to January, but crude oil has risen by almost 20pc since then.