Ireland will see fuel rationing at the forecourt pumps if the war in Ukraine continues, top economists warned.
And the worsening conflict could also see the cost of food skyrocket as the fighting hits the nation’s exports of key crops such as wheat and corn.
A new report has warned that “should tensions increase, further disruptions to gas and oil supplies might occur, and in a worst case, end-user rationing might be required”.
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Two hundred complaints of price gouging at the pumps have been received from members of the public by the competition watchdog.
This is up from 83 a week ago after excise duties on petrol and diesel had been cut by 20c and 15c on March 10.
The number will be revealed at a committee meeting in Leinster House where the CCPC (Consumer and Competition Protection Commission) will update politicians on what they are doing about the alleged unfair price hikes.
Its chairman Jeremy Godfrey, will say in his opening statement: “We cannot insulate consumers from the effects of the global upheaval but we will work tirelessly within our mandate on their behalf.”
As well as forking out for fuel, food prices could soar because Ukraine is known as the “breadbasket of the world” and supplies up to one quarter of the global stocks of essential wheat and corn. Experts have also had to revise the forecast on inflation for 2022, upping it by more than 65% from 4% in its Winter Commentary to 6.7% in its latest Spring Commentary.
The economists at the Economic and Social Research Institute have made these grim predictions in their latest commentary.
The report adds uncertainty over future Covid outbreaks will also pose “a risk to supply chains and global output” – which could see the cost of living rocket again.
Report author, Professor Kieran McQuinn of the ESRI, said: “While the outlook for the Irish economy is still positive in 2022 and 2023, the impact of the Russian invasion of the Ukraine will lower the expected growth rate of the Irish economy and lead to higher rates of domestic inflation.”
The ESRI report says: “The fallout from the recent invasion of Ukraine by Russia will, amongst other issues, further exacerbate inflationary pressures, which have already been evident in the economy.
“Any rise in inflation will pose significant challenges for households in terms of the cost of living.
“It also poses major questions concerning the future sources of energy used across Europe.
“The strain on energy supplies would see a significant increase in fuel costs and this would likely feed through to other prices.
“The spike in inflation associated with these costs would likely lead to a downturn in consumer spending.”
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