MOTORISTS are being hit in the pocket as oil prices continue to soar across the globe, however one local filling station owner has reassured drivers pump prices will soon start to level out.
With oil prices expected to reach $50 a barrel, the price of petrol has jumped by an average of 1.88p in the last month while diesel has risen by an average of 2.19p.
The AA, who explained consumers are only now being hit by the side-effects of rumoured oil production limits, have warned the surge will continue over the next month. However Terry Hughes, of TJ Hughes station in Belleek, has said he believes the price surge should calm down in the coming weeks.
Mr Hughes agreed that a slow-down in production in the US had been what was driving prices upwards. Speaking on Monday, he said their diesel prices in Belleek were currently around 95.9p, while petrol was 1.07p, though he warned these prices could rise in the coming couple of weeks.
“It’s all about supply and demand,” said Mr Hughes, who added prices had been rising over the past few weeks. “This is time of year is what they call ‘driving season’ in America, and at the minute they seem to be stockpiling fuel. Basically, we’ve seen a decrease in output over the past few weeks. Demand is up, but production is down.”
Mr Hughes said the market had been volatile in recent times, however he added end was in sight.
“We will probably see it settle over the next weeks and months, as there may have been a slight over-correction in the market,” he said. “Markets tend to over-correct all the time.
“They could continue to rise over the next week or two, but that should be the highest they get to. It’s currently sitting close to $50 a barrel. It was once at $150, and there was talk of it going to $200, so they are still relatively low. We probably won’t see prices like that again.”
Mr Hughes, who explained that America’s growing self-sufficiency on oil would help keep prices down long-term, added bigger supermarket suppliers would probably feel the current price hikes the most.
“They work with such tight margins, so they will probably feel it more. They might take a hit in the next week or so, but that will level out for them over time.”
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Posted: 9:00 pm June 1, 2016