CONSUMERS have been hit with a new spike in fuel prices of two cents a litre, in response to the soaring price of oil on the international markets.
One of the island’s biggest petrol companies, Petrolina, on Wednesday announced that it was increasing its prices, with effect from yesterday.
Ninety-eight octane petrol now costs 59.8 cents per litre from 57.8 cents, while the price of 95-octane petrol now stands at 57.8 cents a litre, up from 55.8 cents.
Heating fuel is also up, from 45.3 cents to 47 cents, while agricultural fuel has risen by 2.8 cents a litre to 39.5 cents a litre.
Other companies on the island are also expected to raise their prices imminently.
Oil prices have risen to record highs due to a combination of the weak dollar, supply concerns in Mexico and continued tensions in northern Iraq.
Some analysts believe oil prices will hit $100 a barrel before the end of 2007 if current pressures persist.
Dinos Lefkaritis, Petrolina Executive Finance Director, said European consumers had actually been shielded from the full brunt of the increases by the weakness of the dollar against the euro. He said that due to the plummeting value of the dollar, petroleum price increases in Cyprus were 20 to 25 per cent less than the increase in the international price of oil.
Pambinos Charalambous, spokesman for the Association of Petrol Station Owners, told the Mail that prices are high, “but nothing can be done due to the international price of oil. I believe that we will see further rises before the end of the year.”
DISY spokesman Lefteris Christoforou said the government, “must take measures to reduce the price of heating oil” and also called for the abolition of road tax, “in order to ease the financial burden on consumers.”
The price of oil rose to a new record above $96 a barrel yesterday after a surprise drop in US crude stockpiles raised concerns about supplies for coming winter demand.
Light, sweet crude for December delivery rose as high as $96.24 a barrel in electronic trading on the New York Mercantile Exchange by late morning in Singapore. Prices later receded to $96.05 dollars a barrel.
The US Federal Reserve’s move to cut interest rates by a quarter percentage point also supported prices.
Interest rate cuts in the USA generally support oil prices because they tend to send the US dollar downward; the dollar is already at multiple-decade lows against major currencies.
Regarding the price of electricity, which according to the Electricity Authority of Cyprus, changes continuously depending on the prevailing price of heavy fuel oil, increases have been seen this year.
Spokesman Costas Gavrielides explained that last August, “one kilowatt hour for domestic use was priced at 6.77 cents, which had gone down to 6 cents by April 2007. Now, the price is 7.1 cents.”
