Ireland to cut excise duty on petrol and diesel

DUBLIN (Reuters) -Ireland will cut excise duty on petrol and diesel until the end of August to ease the burden of rapidly increasing gasoline prices as a result of the Ukraine conflict, the government said on Wednesday.

The surging price of crude oil on world markets has led to the biggest ever weekly jump in prices at some service stations around Europe, pushing them in some cases, including in Ireland, above 2 euros per litre ($8.25/gallon) of unleaded fuel.

A cut of 20 euro cents per litre on petrol and 15 cents on diesel will take effect from midnight on Wednesday and these are estimated to reduce the cost to fill a 60 litre tank by 12 euros for petrol and 9 euros for diesel, Finance Minister Paschal Donohoe said.

Dublin had already committed 505 million euros ($553.48 million) to ease pressure on households and businesses caused by a 20-year high inflation rate before the Russian invasion, and the latest measures will cost 320 million euros more.

“The government is acting now in response to price rises that we have seen to date but also in anticipation of further rises that we expect to see in the short- to medium-term,” Donohoe said.

“We cannot protect citizens and businesses from the entire cost impact, we are experiencing the consequences of a war.”

Ireland has taken in 2,200 Ukrainian refugees since it lifted visa requirements for arrivals, a figure it expects to rise significantly. The cost of housing and offering services to them will also “certainly be in the hundreds of millions of euros”, Public Expenditure Minister Michael McGrath said.

After Ireland ran a lower-than-expected budget deficit last year, McGrath said the public finances could bear the additional cost and that the government remained optimistic that the outlook for the economy is “quite positive.”

($1 = 0.9124 euros)

(Reporting by Padraic Halpin; editing by John Stonestreet and Jane Merriman)