Fuel prices will double by the fall, according to a leading economist if gas and oil prices continue to rise.
Economist Chris Johns said that surge would be “catastrophic” for consumers.
Mr Johns said the price issue did not just depend on Russia’s invasion of Ukraine.
“This is old-fashioned economics, demand is outstripping supply in certain key regions around the world and for certain key commodities,” he said on today’s Indo Daily podcast on Independent.ie.
“Gas has been a particular concern in Ukraine for some time, partly because Putin has been playing games with the gas supply for at least a year.
“A combination of weather events, a couple of winters ago there was a particularly cold winter that caused gas supplies to run out and then places like Germany didn’t fill up their gas tanks as much as they should and could done in the summer.”
Mr Johns said “demand has exceeded supply” and this has been driving up gas prices for quite some time.
“So in the UK for example, the odd way they do these things, they are only allowed to change their gas and electricity prices to consumers twice a year at the moment and the price increases that have just been introduced in the UK vary from 50 to 100 pieces, so some bills have doubled over the past few weeks,” he said.
“If current prices for things like gas and oil hold their own over the next six months, UK households and by extension other households across Europe, not least Ireland, are likely to nearly double again in the autumn.”
Mr Johns said that with Ireland importing gas from the North Sea via UK pipelines, if Russia cuts off its gas supply, competition for that gas will “increase enormously”.
“First of all, if Russia cuts off its gas supplies to continental Europe, especially Germany, the gas produced in the North Sea will become much more expensive,” he said
“That’s the first thing that will happen, the other thing is, of course, if and when Russian gas supplies to Europe are cut off, the competition for that gas will increase enormously.”
https://www.independent.ie/news/fuel-could-double-in-price-within-next-five-months-leading-economist-41588213.html Fuel could double in next five months – leading economist