Government urged to abandon excise duty hike on petrol and diesel

The call comes after new figures showed prices at the pumps remained steady this month, although the gap between petrol and diesel widened slightly.

AA Ireland’s fuel survey shows that the average price of petrol rose 2c a litre to €1.83 this month, but diesel dropped 2c a litre to €1.76.

Prices are due to rise again in August when the Government plans to fully restore the full excise duty rates on the motor fuels.

Petrol prices are up 15c a litre since the start of the year, with diesel up 7c.

The Government plans to fully restore the excise duty rates on August 1, with a final increase of 4c on petrol and 3c on diesel.

There is also another carbon tax hike expected in October, which means drivers can expect prices at the pump to increase further.

Chairman of the Consumers’ Association, Michael Kilcoyne, said the fact that prices were steady this month should prompt Finance Minister Michael McGrath to ditch the last increase in excise duty.

In March 2022, the Government implemented temporary cuts in the excise duty on petrol and diesel when Russia’s invasion of Ukraine led to fears of a litre of motor fuel hitting €2.

But it has been gradually restoring the full rate of excise duty since then, with the last move to fully restore the old rate due in August.

Mr Kilcoyne said: “They should abandon the plans to fully restore the excise duty as people are still under financial pressure. The cost of living is still increasing for ordinary people.”

He said the cost of food continues to rise, while energy costs for heating and cooking in homes were among the highest in Europe.

“The prices at the pumps are steady now so we do not need to do anything to change that,” he said.

Mr Kilcoyne said that if the August increase goes ahead, the cost of a litre of diesel would hit €1.80, once Vat is added to the excise duty rise. And petrol would go to €1.90 a litre, he said.

Motorists are being helped at the moment by the fact crude oil prices have not fluctuated much lately, with the price holding around $83 (€76) a barrel for Brent crude.

Diesel has returned to being cheaper than petrol as there is now more capacity to refine diesel in western Europe.

Before the Russians invaded Ukraine, EU countries had been getting most of their diesel from Russia, arriving here refined.

There was then a shortage of refining capacity for diesel when we stopped buying Russian diesel. There is now more refining capacity for diesel, so diesel prices are back down lower than petrol, as they were before the invasion.

Head of marketing and PR at AA Ireland, Jennifer Kilduff, said prices at the pumps were holding steady.

“Despite the steep increases we have seen over the past few months, the average cost of fuel in May has not changed too much. We would like to see them decrease, but for now we’ll take the small win that fuel prices overall remain relatively unchanged this month,” she said.

Electric vehicle fuelling costs remain the same this month, meaning EV owners can expect to pay around €925 a year to cover the national average of 17,000km a year, AA Ireland said.