44% rise in heating oil price pushes up inflation up 3.7%

Ireland's rate of inflation climbed to 3.7% in the 12 months leading up to August, marking a 0.3 percentage point increase from the previous year, according to the Central Statistics Office (CSO). The surge in heating oil prices played a significant role in this inflation spike, with home heating oil costs up 44% over the year. Petrol prices rose by 9%, and diesel prices jumped by 15%.

Electricity prices increased by 8%, while airfares saw a 14% rise. Clothing and footwear costs also climbed by 3.6%. Education services experienced a notable 8.9% increase, primarily due to higher costs associated with third-level education, which began in October 2025. Despite the inflationary pressure, food prices increased only marginally by 0.1%.

Meat prices rose by 2.2%, while fish prices went up by 3.3%, but milk and dairy products saw a slight decline of 1.7%. Kate English, chief economist at Deloitte Ireland, predicts that energy prices will maintain their upward pressure as the winter approaches. Oil prices had eased earlier in the summer, but renewed tensions in the Gulf region have caused prices to surge back to levels last seen in May, exceeding $102 per barrel.

Similarly, European gas prices have skyrocketed to levels last observed at the end of 2022. English attributes this to the upward pressure on other pricing metrics, such as freight indices. She warns that these factors combined indicate that inflation will continue to be a concern for both consumers and businesses throughout the coming months.