13 hours ago
- Business
- Irish Independent
Fears conflict in the Middle East will send petrol, diesel and home-heating oil prices soaring
Petrol and diesel prices have been rising for days, and there has also been a surge in the cost of home-heating oil.
The price of 1,000 litres of heating oil has risen by €25 in the past few days, with energy experts expecting more hikes.
Brent crude is up by 8pc since the first strikes on Iran last Friday, and was up by 13pc at one stage.
This has raised fears of even higher increases in the price of petrol, diesel and heating oil.
Late on Saturday, Iran said Israel struck a key fuel depot, while an oil refinery in the capital, Tehran, was also in flames.
Wholesale costs for petrol were up 4c a litre in the past week, with diesel up 3c
Iran has also partially suspended production at the world's biggest gasfield, the South Pars, after an Israeli strike caused a fire there.
Adding to the uncertainty, Iran said it was considering closing the Strait of Hormuz amid the intensifying conflict with Israel. Such a move would send oil prices soaring.
Petrol and diesel prices are already up in the past few days, according to Kevin McPartlan of Fuels for Ireland, which represents the major petrol retailers.
He said wholesale costs for petrol were up 4c a litre in the past week, with diesel up by 3c.
Industry sources expect prices at the pumps to keep rising because of the conflict in the Middle East.
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Mr McPartlan said: 'The various different factors that impact on petrol and diesel prices are all going in the wrong direction.'
He denied his members were 'ripping off the public' by quickly increasing prices and failing to drop them when crude had fallen earlier this year.
He said profit margins were thin on the sale of petrol and diesel, and what he described as dynamic pricing meant wholesale prices were reflected quickly in what would be charged by petrol retailers.
Prices charged by forecourt operators reflect the wholesale price when the ship containing the refined petrol and diesel leaves port, with most fuel coming to Ireland from Wales.
1,000 litres of heating oil is €900, nearly 10pc less than this time last year
Mr McPartlan said some petrol retailers would take deliveries several times a day.
Michael Toner, of home-heating oil price comparison site said his site had recorded strong rises in prices.
'We're seeing a big jump in heating oil prices in just a couple of days of over €25 for 1,000 litres and we're expecting that to increase further,' he said. 'This is undoubtedly as a result of conflict in the Middle East between Israel and Iran.'
The price of 1,000 litres is now averaging €900, 'which is still nearly 10pc less than it was this time last year, but we are fully expecting that gap to narrow', Mr Toner said.
Energy expert Dr Paul Deane, of University College Cork, said there had been a jump in EU wholesale gas prices in the past few days, but it had been modest in relation to past price increases.
However, of concern is the potential closure threat to the Strait of Hormuz, a shipping route for nearly 20pc of global liquid natural gas (LNG) trade.
If this were to happen, it would increase prices, but the magnitude would really depend on the duration, Dr Deane said.
