Relief for drivers as fuel prices stabilise and petrol prices drop to €2 per litre

It is now hoped that less volatility in the markets for energy and fuel will help quell the spiralling inflation that has rocked both businesses and consumers this year.

The Irish Independentcan reveal the national average for petrol is €2 and €2.01 for diesel, according to the latest AA Ireland fuel survey.

However, prices as low as €1.89 for petrol and €1.90 for diesel have been recorded nationwide which is the first major drop since the outbreak of war in Ukraine.

Irish consumers have been grappling with soaring inflation for months, and not just at the petrol pumps.

Prices in Ireland overall rose by 9.6pc in the year to July 2022, according to figures in the EU Harmonised Index of Consumer Price (HICP) released yesterday. This outstripped the 8.9pc average across the eurozone.

In the space of the past year, the price of diesel has jumped by an unprecedented 41pc while the price of petrol rose by 30pc. Within days of being introduced in March, the Government’s excise cut of 20c per litre on petrol and 15c on diesel was wiped out.

Fuel prices around the country remain volatile since the Russian invasion of Ukraine, however the seemingly endless price surges are now stabilising, according to industry experts. While prices remain high, motorists can take comfort that they have dropped in recent weeks and now fewer shocks are predicted.

Kevin McPartlan, CEO of Fuels for Ireland, said the market had entered a period of stability after the turmoil caused by the Russian invasion.

“In the past, some of the increases were based on uncertainty around the sanctions placed on Russia and fears Putin could cut supplies completely,” he said. “There has also been a slight increase in global production, which has also stabilised supply.

“And the global market has adjusted to the new circumstances of not relying on ­Russian oil in Europe.

“But the most important thing that has influenced prices now is that all of the shocks to the market created change.

“It meant people had to buy from suppliers they wouldn’t normally buy from, and they had to source shipping routes they wouldn’t normally.

“Those things have begun to bed in now. It’s a bit more ‘business as usual’. People know where they stand. Any market hates uncertainty. We are coming into a period of stability where there shouldn’t be such wild fluctuations.”

As the price of fuel and energy stabilises and even drops it is hoped that other goods and services across the board will follow.

In terms of inflation in general, the HICP showed that energy was up 50.4pc in the year to July but fell 1.6pc in the month. It is hoped that if fuel and energy prices fall further in the coming weeks then we will get over the peak of inflation.

Anna Cullen, of AA Ireland, said while the news overall is positive, motorists still remain under pressure.

“We have seen a slight drop in fuel prices recently. Petrol is now at a national average of 200.3 cents per litre, with diesel at 201.8 cents per litre,” Ms Cullen said.

“In June, the prices were 213.2 cents per litre for petrol, and diesel was at 205.0 cents per litre. The market has somewhat stabilised in the last few weeks, and supply levels are good at the moment.

“We hope that this price decrease continues at the pumps. However, it’s hard to predict at this stage. The current average prices are still the highest we have recorded since we started in 1991.

“If you compare them to the same period last year, petrol prices have increased by 30pc, while diesel prices have increased by 41pc.

“Compared to last year, it now costs €595 more to fill an average petrol car for the year and it costs €610 more to fill your diesel car. Looking at the current prices, to fill your tank in an average petrol car, it will cost you around €100, and it will cost you €101 to fill a diesel tank.

“We have stated many times that the prices are severely affecting everyone, but particularly people in rural areas that do not have alternative options.”