Oil prices breached $100/barrel earlier this week on the news that war had broken out in Ukraine. David Blevings, spokesperson for the IPRA said,” Prices were already inflated, driven by strong demand from unprecedented economic growth and a lack lustre approach to increasing stocks from OPEC members. World oil stocks are at a seven-year low, and the breakout of War in Ukraine adds a huge unknown into the market.

Any sort of predictions on future pricing are currently unreliable as there are too many factors at play. The market has retreated slightly today (Friday) after spiking higher mid-week on the news that war had broken out and we are likely to see some further spikes depending on what happens on the war front.

Unfortunately, these increases in global pricing will translate into increased wholesale and retail fuel costs. The retailer has no option to pass on these costs to consumers as they are all independent businesses who must make a profit to survive and pay overheads, including staff wages.

We have today asked Government to reduce fuel duty by 10cpl for a period of six months to help consumers already dealing with recent increases in food and energy costs. On a positive note, with these inflated global oil prices we would expect to see the US, China and Japan releasing some of their strategic oil reserves to supplement any reduced supply and hopefully, that could soften the blow of increasing costs”

The Government has been urged to follow Swedish moves to cut taxes on petrol and diesel as a means to help people struggling with the price of energy bills.

Last month, its parliament was asked to green light the move amid surging costs, saying it would reduce forecourt prices by 5 cent per litre, lowering the country’s tax take by about €225 million.

In 2020, the latest available data, the Irish State took in €1.8 billion in tax receipts from petrol and diesel. Over the last year, fuel price rises of a third were close to the highest ever recorded.

As the Government comes under increasing pressure to address rising living costs, the Irish Petrol Retailers Association (IPRA) said Ireland should consider to follow suit in cutting prices.

“We are seeing it [the effects of rising prices] on the forecourts with more drive-offs evident and consumers buying a specific amount of fuel rather than filling the tank,” said spokesman David Blevings.

“Unfortunately, retailers have no control over increasing global oil costs and must pass these increases on to consumers or face going out of business.”

The Government has already moved to help homeowners with escalating domestic energy bills. The Department of Finance did not respond to requests for comment on the possibility of reducing fuel tax.

Economic turnarounds

Forecourt prices rise in sync with crude oil which, the IPRA has noted, reached $85 (€74) per barrel for Brent crude last November, an increase of more than 50 per cent since last January.

Several causes are cited including a cutback in production from OPEC countries (Organisation of the Petroleum Exporting Countries) and Russia, at the same time as global economies undertake rapid economic turnarounds from the global Covid-19 pandemic.

Monthly data from the AA shows that in January, petrol in Ireland cost on average about 175.5 cent per litre, and diesel about 166.1 cent. However, those prices before tax were 77.912 and 81.134 cent respectively. As of January 31st the average price of oil per barrel was $87.58 (€76.45).

See the Article in the Irish Times HERE

The news that the Health Executive Service (HSE) has reached 450,000 vaccinations as of 1^st March is welcomed as they continue to vaccinate those in the priority 1 – 3 groups.

The Irish Petrol Retailers Association understands that Government has drawn up lists and begun the classification of “essential” workers for the purposes of vaccination, with individual departments asked to submit different categories of workers that may be given priority access to doses.

David Blevings, spokesperson for the IPRA explained, “It is proper and correct that the elderly and frontline health staff are prioritised, and we are encouraged by the progress by the HSE to date. Once the priority groups have been completed, we are keen to see front line retail staff included in any priority list.

Our members have been working throughout the pandemic and many retailers regularly report the lack of mask wearing by patrons at their stores and staff must continually remind customers to wear one and observe social distancing.

Most of our members are small family-owned businesses, essentially SME’s and they depend on family and staff to keep the operation open offering fuel for essential users and food supplies for local customers. They do an important job, and it would be fair to see them included in any priority list as key workers. We have today written to the Taoiseach’s office asking for retail staff to be classified as essential workers and included in this list”, added David.

The Government has announced a 66-point action plan to bring down costs of insurance for consumers and business. This follows several years of escalating premiums which has been a bone of contention amongst motorists and commercial users, with many taking part in demonstrations outside Leinster House.

A cross-departmental working group was set up by the Government to tackle the rising cost of car insurance premiums, introduce more competition into the market; prevent fraud and reduce the burden on business, community and voluntary organisations.

David Blevings, spokesperson for IPRA said, “The insurance reform plan is to be welcomed but we need to see urgent action to implement the changes proposed”.

The reforms will consider penalties for fraudulent claims and the passing of legislation that will make perjury an easier offence to prosecute.

“Many of our members in the retail fuels sector have fallen victim to allegedly spurious claims in the ‘slip, trip and fall” category and members’ report insurance companies appear quick to pay out large amounts in compensation rather than defend claims which ultimately leads to an increase in business insurance premiums the following year.

“We look forward to the new plans reducing insurance fraud in the business sector and the proposal to include placing perjury on a statutory footing, thus making the offence easier to prosecute is very good news”, added David.

Dear Iveta

We refer to previous correspondence and many thanks for your continued interest in our dilemma.

While we do understand the unfortunate circumstances which has led to a delay in reviewing and processing this case we would appreciate if you could give us an indication of a time line for a response.

As we have stated in our communications there is a huge disparity in valuations between forecourts and large retail operators following the revaluation by the State in 2017/18.

Our issue is that many of our retail members have been invoiced for their rates based on the new valuation that we contend has been calculated using an unfair and anti-competitive methodology. A large number of our members have appealed the valuation issued but with an appeal taking up to three years to be heard we have genuine concerns that some members will not survive especially with some increases payable of up to 500%.

This is grossly unfair and we should be grateful to learn if there is any way the Commission can ask or force the Valuation Office to defer or hold off on the cases that are under appeal so these business can survive?

Your early response would be greatly appreciated.

Yours sincerely

Michael Griffin

Michael Griffin CEO

Irish Petrol Retailers Association

E: office@ipra.ie

Dear Tánaiste

The Irish Petrol Retailers Association (IPRA) is the trade association for independent petrol retailers in Ireland. The sector employs over 100,000 people and if you include family this represents over 250,000 people dependent on the industry. Many of our members are smaller retail sites, often the bedrock and only retail facility in some rural villages.

Firstly, we want to congratulate you on your appointment as Tánaiste and wish you well in that position.

Secondly, as you prepare your support package to help businesses navigate their way out of the pandemic, please be aware of the issues surrounding the revaluation of retail forecourts and the huge disparity in valuations between forecourts and large retail operators. I have attached our white paper clearly outlines the issue and demonstrates that retail sites are penalised for having fuel pumps outside their retail business. The independent service station operator has not been treated fairly and we would really appreciate your assistance in seeking a resolution to the current impasse.

Despite being open as an essential service during the pandemic, our members are reporting a reduction in fuel sales of up to 70%. The smaller independent retailer will not survive if Government does not tackle this inequality as a matter of urgency as our members’ are being asked for these revised rate payments now and are not in a position to pay them post Covid-19.

As well as including retail forecourts in any support plan (a rate exemption for one year would be our suggestion) can your office request from senior civil servants in the valuation office an explanation for their rationale in reducing the rateable valuation for most businesses in the country when these businesses were not even requesting reductions and then to clearly target 4 or 5 specific business sectors and impose extraordinary excessive increases of 300-400% on these sectors to try and make up the shortfall?

Dear Minister O’Brien

The Irish Petrol Retailers Association (IPRA) is the trade association for independent petrol retailers in Ireland. The sector employs over 100,000 people and if you include family this represents over 250,000 people dependent on the industry. Many of our members are smaller retail sites, often the bedrock and only retail facility in some rural villages.

Firstly, we want to congratulate you on your elevation to Minister for Housing and wish you well in that position.

Secondly, you are well aware of the issue surrounding the revaluation of retail forecourts and the huge disparity in valuations between forecourt and large retail operators. Basically, retail sites are penalised for having fuel pumps outside their retail offering. At our last meeting you indicated an understanding of our position and if I read the meeting correctly, you supported the retailers’ position.

When I read again your home page on the web it says, “Right at the centre of our life’s work is respect for all, sharing and spreading the wealth we create to all those who deserve it by right, treating people fairly, and giving maximum equal access to all who need services and due care, promoting the talent and potential of all for our greater good”.

The independent service station operator has not been treated fairly and we would really appreciate your assistance in seeking a resolution to the current impasse. The smaller independent retailer will not survive if Government does not tackle this inequality as a matter of urgency as our members’ are being asked for these revised rate payments now and are not in a position to pay them post Covid-19.

We should be grateful if you could meet a deputation of retailers virtually to discuss this matter urgently and seek a resolution that is fair for all parties.

Yours faithfully

Michael Griffin

Michael Griffin CEO

Irish Petrol Retailers Association

E: office@ipra.ie

Now that the much awaited Irish Programme for Government (PFG) document has been agreed it is more important than ever that we can put your views to elected Members and push the retailer agenda.

Please review the document and feedback your experiences on these topics. On the back of that information we can engage with the suppliers and government officials and make real change.

Send your information to office@ipra.ie or pick up the phone to Michael on 087 254 6512.

We really do need your views on these important issues and many thanks in advance.