Motorists likely to be hit by petrol price hike

MOTORISTS already facing a more expensive New Year could have to dig even deeper with an expected increase in petrol prices.

The price of oil reached a two-year high on Monday but steadied again yesterday.

However, with fears of war in Iraq and other volatile situations in the market, punters are likely to feel some knock-on effect.

A number of petrol retailers in Britain have already started adding 2p to their prices and AA Roadwatch’s Conor Faughnan believes similar trends will emerge here very shortly. He said it looks like another tough year for the average Irish motorist.

“There are likely to be some increases in petrol prices but they shouldn’t be too significant because the euro is performing well against the dollar,” he said.

“However, the cost of motoring will be significantly more in 2003 than it was last year. Inflation is well alive in the cost of running a car despite the Government’s efforts.”

When the United States went to war with Saddam Hussein a decade ago, oil prices were affected globally, although the impact was nothing like that of the fuel crisis in the 1970s.

The expected rises come after last month’s Budget saw a 3c per litre hike in excise duty on diesel, although petrol prices went untouched.

But other New Year gifts to motorists from the Government include:

A 12% hike in motor tax rates from today (over twice the rate of inflation).

An extra 1% on car service charges as a result of Budget VAT hike.

Vehicle Registration Tax for new cars over 1,900cc up from 25% of sale price to 30%.

Possible toll charges for using new motorway routes.

Insurance premiums are also continuing to rise over and above the rate of inflation, making it far from a prosperous new year for the Irish driver.