Cutting fuel taxes is not the answer

UNLIKE Donal Fellows (Letters, July 19), I do not believe that fuel costs can be controlled by governments. Firstly, oil is a freely traded commodity, and in Ireland, which is a free market economy, it is imported, thus removing any control in cost that is possible by the State.

The cost of a barrel of crude oil has increased from $20 in 2002 to approximately $80 this year. Such dramatic rises mean that any impact a government might have is greatly reduced.

Mr Fellows points out that the Government currently charges VAT and excise duties on imported fuel, and while a reduction in the rate of excise duty would result in a price drop at the petrol pumps, such a reduction would have a reduced effect because oil prices are expected to reach $100 a barrel by the end of this decade.