Fuel prices are once again on an upwards trajectory, having risen by over 9c/l in the past month. Prior to this, prices had been dropping for consecutive months and dipped below the euro mark in mid-December to lows of €0.94/l (including VAT). Fuel suppliers are blaming increases on the rising tensions in the Middle East, which have spread beyond Israel and Gaza and now affect global shipping through the Red Sea.

As we went to press this week, prices being quoted for bulk orders of Marked Gas Oil (MGO), or green diesel as it’s known, were ranging from €1.05/l to €1.08/l (including VAT).

All merchants and suppliers contacted in our survey highlighted that the current market volatility has resulted in almost daily price increases within the last week. One supplier in the west explained that prices went up 3c/l last Friday, followed by a further 2c/l on Monday and an additional 1.8c/l on Tuesday, this week. Several other suppliers confirmed price increases of 2c/l and 3c/l between Monday and Tuesday evening.

International oil markets

The tensions surrounding the Israel - Hamas conflict had left international oil markets uncertain, but now that global shipping has been affected, oil markets are even more volatile. The interruption of global shipping through the Red Sea, one of the world’s most densely packed shipping channels south of the Seuz canal and the most significant waterway linking Europe to Asia and east Africa, is driving up prices of all consumer goods, not just fuel.

Since November, Houthi rebels in Yemen have been attacking commercial shipping vessels using the route. The alternative is to go around the Cape of Good Hope, which increases shipping time by 30-50%, never mind the additional cost. BP and Shell have paused the shipment of oil through the Red Sea as a result, with other companies to follow suit if tensions don’t ease. If this happens, fuel prices are likely to rise further.

Brent crude

Brent crude prices started the month at $75-$76/ barrel and have steadily climbed. At the time of print, Brent crude was trading between $82 and $83/barrel. Prior to this month’s increase, Brent crude had been approaching a six-month low, trading around $74/barrel at its lowest on 12 December.

Analysts report that the main threat to ships transiting the Red Sea aren’t felt on crude oil prices, instead it is refined fuels that are most at risk.

Figures from the Central Statistics Office (CSO) show that Irish green diesel consumption figures rose from 1bn litres per year just one decade ago, to approximately 1.15bn litres in the 12 months to November 2023.