Tuesday, 26 February 2013

Questions (99)

Bernard Durkan

Question:

99. Deputy Bernard J. Durkan asked the Minister for Communications, Energy and Natural Resources the extent to which he and his Department directly or in conjunction with the Regulator have endeavoured to ascertain the extent to which petrol and diesel prices at filling stations accurately reflect oil prices on the world markets throughout each of the past six years to date; if he will set out the prices charged per barrel throughout the period in question; the prices charged at filling stations in the same period; and if he will make a statement on the matter. [9955/13]

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Written answers (Question to Communications)

Neither I nor the Commission for Energy Regulation has a statutory function in the regulation of petrol and diesel prices.

The Irish oil industry is fully privatised, liberalised and deregulated and there is free entry to the market. There is no price control and it is Government policy to encourage price competition and consumer choice.

The upward trend in petrol and diesel prices arises primarily from increases in international commodity prices over which Ireland has no control. For example, the benchmark spot price of a barrel of Brent Crude Oil has risen from an average of US$58 in February 2007 to an average of US$117 in February 2013. This has inevitably resulted in an increase in retail petrol and diesel prices.

Previous surveys have shown that prices charged by Irish retailers for oil products relate to the refinery price rather than to the price of crude oil. Prices at the pump reflect volatile market prices, transportation costs, trends in euro/dollar exchange rates and other operating costs, together with the impact of taxation on oil products.

The EU Market Observatory publishes an Oil Bulletin with current and historical oil product prices for all EU countries. As of February 11th 2013, the price of petrol in Ireland was marginally below the EU average; while the price of diesel was 4.8% higher than the EU average.

If duties and taxes are stripped out then the price of petrol in Ireland was 98.5% of the EU average; and the price of diesel was less than 1% higher than the EU average.

Against the background of high world oil prices my focus is on measures that will increase the penetration of renewable energy resources in the area of transport.

The Biofuel Obligation Scheme incentivises and enables the sustainable growth of an Irish biofuels market. The Scheme currently requires that the amount of biofuel brought to the market is not less than 6.38% of petroleum road transport fuels. In 2011 some 145 million litres of biofuel were brought to the Irish market.

The development of electric vehicles offers potential for Ireland to use cheaper grid sourced electricity, an increasing amount of which is sourced from renewable resources.

These opportunities will progressively reduce our dependence on imported fossil fuels for transport, while supporting energy competitiveness and security.