There is some rare good news for motorists and business fleet operators with latest reports from the AA saying that petrol and diesel prices have fallen for the second month in a row.

Fuel prices reached a record high in September, but have since been pegged back. AA Ireland reported that the average price of a litre of petrol is now €161.2, down 6.7c from the pervious month while a litre of diesel is down 2.8c at € 1.56c, down 2.8c.

The figures show a second sharp fall in prices in two months but the AA say that motorists are still being squeezed. Director of Consumer Affairs Conor Faughnan said that 2012 has been the worst year in our history for fuel prices. He comments, “We began the year with record high prices and a budget tax increase and it got worse with each passing month. Prices hit an astronomical 1.70 a litre in September and have moderated since then.”

The fall in the last two months has been caused by a slight reduction in world oil prices and a slight improvement in the exchange rate of the Euro versus the US dollar. While this is welcome, the AA reports that a typical motorist who consumes 150 litres of petrol per month will pay out €19.35 extra this month compared to the same period last year and €45 more monthly than two years ago.

The AA say government duty and not international factors are the main concern. It points out that when a motorist pays €1.61 for a litre of petrol, 56.4% of that is tax. This means on average each month a typical Irish motorist will pay €241.80 for fuel of which €136.38 is tax.

The AA has repeated its call to the Irish government to end the policy of crippling fuel taxes which it says are a burden on motorists and businesses that drain disposable income out of the local economy. It also points out that further hikes in fuel duty may actually have the effect of reducing overall government income as motorist leave their cars at home.