Falling world oil prices a boost for car owners

Tumbling international oil prices have brought good news for motorists but there is no immediate respite from price rises for…

Tumbling international oil prices have brought good news for motorists but there is no immediate respite from price rises for electricity and gas consumers.

Average petrol prices are expected to dip below the symbolic €1 a litre barrier over coming weeks as the price of oil falls to its lowest level in 18 months.

However, consumers have been told to watch out for petrol price rip-offs, with AA Ireland warning of price fixing among some service stations.

An Irish Timessurvey of petrol prices yesterday uncovered massive disparities.

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A Statoil station on Usher's Quay in Dublin was selling unleaded petrol at almost €1.36 a litre, more than one-third higher than the average price. Attempts to contact management at the station were unsuccessful.

Less than half a mile away, the Emo station in Kilmainham was selling unleaded at €1.01 a litre.

Meanwhile, the Tesco stations in Ardkeen and Dundrum and the Applegreen stations in Clonskeagh and Arklow were already selling at under €1 a litre.

Meanwhile, the energy regulator says it has no immediate plans to pass on oil price reductions to gas and electricity users.

Electricity prices went up more than 12 per cent at the start of January and gas prices rose by more than 33 per cent in September.

Earlier falls in oil prices had prompted the Commission for Energy Regulation to order a 10 per cent reduction in gas prices, to come in next month.

Fine Gael yesterday called on the Government to ensure the consumer benefited immediately from recent price changes.

"The most recent drop in oil prices on international markets is further confirmation that price increases in gas and electricity here over the past three months were totally unwarranted, unjustified and merely served to enhance oil company profits and Government revenues in imposing a heavy penalty on the manufacturing services and domestic sectors," said the party's natural resources spokesman Bernard Durkan.

The average price of unleaded petrol and diesel last month was €1.04 a litre, according to AA Ireland, which surveys prices on a monthly basis. However, this month's figures are certain to show a fall when they are published next week, according to its spokesman Conor Faughnan.

"Price competition in the Irish market is reasonably healthy and there is no evidence of cartels operating nationally. But on a local level things can be smellier, and we strongly suspect local price-fixing in some areas."

He said the disappearance of many urban service stations, which were being sold for their development potential, was making it hard to source petrol conveniently but had not yet affected price.

Mr Faughnan said the weakening of the dollar against the euro was also contributing to falling prices at the petrol pump.

Oil is currently selling at under $56 a barrel on international markets, the lowest level since June 2005. At that time average petrol prices in Ireland were under €1.02 a litre, more than two cent lower than at present.

During last year's price surge they reached a peak of more than €1.22 a litre.

Mr Durkan said petrol and diesel prices at the pumps must indicate that the oil companies were passing on reductions to the consumer and "lay to rest the current practice whereby, with a few exceptions, there is a distinct reluctance to reduce the price per litre below €1".

Falling oil prices have started a price war among British petrol retailers but there are no signs of Irish outlets following suit.

Paul Cullen

Paul Cullen

Paul Cullen is a former heath editor of The Irish Times.