Taxing question of what we should do with our own oil discoveries

THE country’s main domestic gas provider is being allowed to put up its prices by 8.5%, following on a 20% price increase over the last year.

It is expected that Bord Gáis’ rivals will be allowed similar price increases by the energy regulator. Petrol and diesel prices have soared to over €1.70 per litre at the pumps, meaning that motorists are paying more for their fuel than they have ever done before: the AA has estimated that the average motorist is paying €1,400 per annum more on fuel now than he or she did three years ago. The weather may be very mild and pleasant this week, but those who depend on home heating oil have to think of stocking up because such conditions cannot last. A survey by the National Consumer Agency released yesterday suggested that 1,000 litres of this essential will cost buyers €964, on average.

Why is all this happening? There are a variety of reasons, including significant Government taxes, which can be held responsible. Rising international oil prices are often blamed on political uncertainty in oil producing regions for fear that supply might be interrupted. (Tell me, when is there ever anything other than such uncertainty). But gas prices globally are falling because of the controversial extraction of shale gas by environmentally dubious methods. The fall in the value of the euro against the dollar is a major problem, a 16% drop making imports from non-EU regions more expensive, and oil and gas are priced internationally in US dollars. Our energy dependence on imports is a major negative at times like this.