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IPRA responds to negative press about fuel price increases

10th March 2022
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The heightened geo-political tensions resulting from Russia’s invasion of Ukraine, and the package of economic sanctions imposed by the West in response, means that we have seen unprecedented increases in prices for crude oil and refined petroleum products (petrol & diesel).

Responding to negative press coverage about increased prices, David Blevings said, “It is important that consumers understand what is happening and realise that these circumstances are not within the control of local fuel retailers.

On the 1st February Brent crude was trading at $89.16/barrel and by 8th March it had risen to $127.98/barrel. In refined product cost terms that meant diesel jumped 76% and unleaded by almost 50% – that’s whey we are seeing diesel more expensive than petrol currently.

There is a misconception that retailers have stock in their tanks from weeks ago that was bought at a ‘cheaper’ price. The reality is most sites across Ireland purchase fuel daily and operate on a previous day market closing price. So, if the market is trading up and closed €0.20cpl higher last night your purchase price for collection at the terminal the following day is up by the same amount.   A forecourt operating on a previous day price must pass on these cost increases immediately. Not doing so would be commercial suicide, but this volatility leads to big price differences at the pole sign as we have seen in recent days!

In terms of claims that some stations did not pass on the excise reduction announced by Government on Wednesday, remember that any fuel already in the station’s tanks had paid the duty at the higher rate – businesses can’t simply take a hit of 15cpl & 20cpl on fuel – to do so would mean they were selling the fuel at a loss – not a great business proposition.

No-one likes inflated prices, even retailers and the good news on top of the reduced excise rate is that OPEC has signalled that the cartel may be able to increase production given that many countries are trying to phase out Russian supplies – any increase in production from OPEC and Saudi Arabia is to be welcome and may yet help stabilise the market”, added David.

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IPRA responds to global oil price increase…

25th February 2022
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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”

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Coalition urged to follow Swedish move to cut car fuel taxes amid rising energy bills

7th February 2022
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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

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Don’t blame retailers for price hikes, says IPRA

27th October 2021
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“As you are aware fuel prices have risen significantly in recent months. The primary driver is the increase in crude oil costs which have recently passed $US 85/barrel for Brent Crude. This is more than a 50% increase since January 2021 and something the retailer has no control over. It has been caused by a cutback in production from OPEC countries and Russia at the same time as the global economies are staging a rapid economic turnaround from the global pandemic. There is no immediate solution in sight, and some are speculating that we could see further rises to $US100/barrel by Christmas.
 
As you can see from our infographic, with the recent carbon tax increases taxes make up almost 65% of the pump price. While we acknowledge that an increase in carbon tax is the Governments way to encourage consumers to look at alternative options for driving i.e.: electric cars – this is fine in an ideal world where everyone has easy access to electric charge points and cheap electricity; IPRA does not believe we are near that point at this time and a lot of work is still required to encourage consumers to move away from fossil fuels. Our belief is that with alternative fuels such as hydrotreated vegetable oil (HVO) available now and offering an immediate 88% reduction in CO2 emissions, liquid fuels will be around for many years to come. Government needs to look at a range of options to reduce emissions from transport and offer incentives and subsidies to encourage further development around bio and synthetic fuels ”.

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Petrol retailers call on Government to include forecourt staff in ‘priority vaccine lists’

4th March 2021
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The news that the Health Executive Service (HSE) has reached 450,000 vaccinations as of 1st 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.

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IPRA welcomes Government’s insurance reform plan…

9th December 2020
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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.

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IPRA asks for an update on rates issue from EC competition authority….

21st July 2020
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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

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IPRA asks Varadkar to include retail forecourts in support package….

9th July 2020
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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?

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IPRA seeks urgent meeting with Minister O’Brien on rates issue….

2nd July 2020
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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

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Petrol retailers call on Government for support after Covid-19 has diminished their fuel sales by c.70%

24th June 2020
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As Ireland moves to Phase 3 of the easing the COVID-19 restrictions on 29 June the Irish Petrol Retailers Association (IPRA) has called on the Government to support forecourt traders as the sector has been badly affected with severely reduced turnover and profit despite many being open as essential services during the pandemic.

 

David Blevings, spokesperson for the IPRA explained, “The majority of our members are small family owned businesses, essentially SME’s and they have seen their fuel sales drop by c.70% during the pandemic. Despite being open as essential retailers the business has not been there as the majority of vehicles were taken off the road and profitability has suffered as a consequence.

To compound their problems, retailers are still being levied with rates bills based on the 2017 revaluation even though many have appealed these valuations as grossly unfair. Minister Humphries supported the sector’s call to establish a rates forum to review the methodology of the 2017 revaluation but to date, no action has been taken by Government.

If we don’t see a soft loan scheme for fuel retailers and a six months write off for commercial rates we will see the closure of some rural fuel sites which would be a disaster for isolated rural communities as the filling station is the mainstay of the local village”, added David.

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