BY JEROME HUGHES
DONEGAL households are currently facing home heating oil prices that are up to €143 higher for 500 litres compared to the rates in Northern Ireland.
The recent cold spell in the region heightened the demand for heating oil (kerosene), shedding light on significant price disparities between Donegal and Northern Ireland.
The website ‘oilprices.ie’ provides up to date information on 14 kerosene suppliers across Donegal. As of last Friday, the charge for 500 litres of home heating oil ranged from €527 to €565, a difference of €38 between the cheapest and most expensive.
Another website ‘cheapestoil.co.uk’ compares the prices of 79 kerosene suppliers in Nothern Ireland. On Friday, the lowest price on the website for 500 litres, when converted to euro, was €422 – that’s a whopping €143 less than the highest price in Donegal.
CEO of Fuels for Ireland, Kevin McPartlan, spoke to Donegal News.
“The invasion of Ukraine, and the subsequent sanctions imposed on Russia, were a major shock to global fuel markets, one which continues to impact prices.”
Fuels for Ireland, formerly known as the Irish Petroleum Industry Association, brings together companies involved in the importation and distribution of fuel.
“In recent months, market issues have been compounded by conflict in the Middle East and now disruption to customary shipping routes,” explained Mr. McPartlan.
In relation to cross border trade, the lack of VAT and Carbon Tax on home heating oil currently creates a significant price differential between North and South. There are calls on the government for this to be reviewed given that kerosene is an essential product for so many.
“64% of homes in Donegal use oil to heat their homes and, while they can rely on their local fuel supplier to keep their families warm, they must look to Government to seek measures which could reduce the high levels of tax and other levies applied to home heating oil relative to friends and neighbours across the border,” suggests Mr.McPartlan.
That point has been echoed by Gavin O’Donnell, the owner of O’Donnell Fuels, based in Crolly and Illistrin, Letterkenny.
“It’s common for people to get a big electricity bill and then suddenly run out of oil. It’s not fair on people being hardest hit by the cost of living crisis. The government needs to seriously look at the taxes on heating oil because many people are really struggling,” said Gavin.
“We’ve introduced a scheme whereby customers can pay €20 every month. Then when their oil runs out it’s not such a big shock,” added Gavin.
The average price for 500 litres of oil in Donegal last October was €595 but that’s relatively modest compared to the €775 cost shortly after the war in Ukraine escalated in February 2022, subsequent to which energy sanctions were placed on Russia by the West.
These are tumultuous times for the global fuels industry and there’s a direct impact for Donegal consumers.
Sanctions against Moscow have had a global impact on supply, and increased costs on suppliers in terms of ensuring compliance with the sanctions.
Industry insiders claim some rogue traders are trying to sneak Russian product onto the market and so legitimate fuel companies must constantly scrutinise supply chains very carefully.
The war on Gaza has only added to the upward pressure on fuels because even before any genuine disruption caused by the war there, traders were loading the risk-factor into prices.
Shipping is now being impacted with many major operators refusing to risk attack from Houthis and so are routing vessels around the Cape of Good Hope. This impacts delivery times and therefore pricing.
All that said, and while prices remain volatile, they are significantly lower than when the war in Ukraine was having maximum impact – down about 30%.
Experts say heating oil prices are far more susceptible to fluctuations in the price of crude oil than transport fuels.
This is because so much more of the price paid for diesel and petrol is made up of taxes and levies than is the case for kerosene.
Various oil suppliers in Donegal we contacted have shared their experiences of the bad weather last week. Phones were apparently “flying off the hook” due to freezing conditions and therefore the need to keep heating dials up high.
“The roads were really bad last Wednesday, Thursday and Friday. It was very difficult trying to get to everyone, especially in the more rural areas,” explained the aforementioned Gavin O’Donnell.
Gavin told us he has been “flat out”, suggesting everyone seems to want fuel at the same time when a cold snap hits.
“I’d encourage people to plan ahead for the next time temperatures drop dramatically. Regularly dip your tank so that you don’t run out unexpectedly.
“It’s also very important that we check on elderly neighbours when it gets very icy to make sure that they have enough heating,” suggests the O’Donnell Fuels boss.
Receive quality journalism wherever you are, on any device. Keep up to date from the comfort of your own home with a digital subscription.
Any time | Any place | Anywhere
SUBSCRIBE TO CURRENT EDITION TODAY
and get access to our archive editions dating back to 2007(CLICK ON THE TITLE BELOW TO SUBSCRIBE)