Petrol and oil prices about to rise

Motorists and consumers face further increases in the price of petrol and home heating oil in the next few days as the Republic's major fuel suppliers move to boost wholesale prices.

Petrol will increase across the board by about 2.3 cent a litre plus VAT of 21 per cent, bringing the rise to about 2.8 cent and adding €1 to the cost of filling the average car's fuel tank.

Home heating oil products are likely to jump by more than one cent a litre, increasing the cost of filling domestic heating fuel tanks by about €100.

Diesel will go up by anything between 0.6 cent a litre in Maxol forecourts and 1.06 cent a litre in Shell and Statoil service stations.

Both Maxol Ireland and Topaz, the Denis O'Brien-backed company that owns the Shell and Statoil brands in the Republic, increased their wholesale prices at midnight on Wednesday.

Most of the other major players are expected to follow suit, and the increases will be passed on to consumers over the next few days.

Consumers are facing the increases as crude oil breached the $100 a barrel threshold in New York yesterday, having touched that level on Wednesday.

While this week's price hikes reflect increases in global refined product costs dating back before New Year's Day, rather than the current crude oil price, gasoline and kerosene prices tend to follow crude oil prices.

A Topaz spokesman said the increases were the result of continued "upward pressure" on world prices.

Maxol Ireland chief executive Tom Noonan yesterday said that speculation and increased investor demand for commodities such as oil were driving up prices.

"Fundamentally, the supply and demand picture is fine," he said. "A lot of this is the result of speculation and weak stock markets."

He added that the Government gets 60 per cent of what consumers pay for petroleum products. Mr Noonan predicted that oil prices would remain above $90 a barrel for the foreseeable future.