The price per liter of gasoline at Icelandic oil company N1 increased by ISK 1.5 (USD 0.02, EUR 0.02) to ISK 134.40 (USD 2.17, EUR 1.47) and of diesel by ISK 0.5 (USD 0.01, EUR 0.005) to ISK 136.90 (USD 2.21, EUR 1.50) yesterday due to rising oil prices on the international market.
According to Sveinn Hjörtur Hjartarson, economist at the Federation of Icelandic Fishing Vessel Owners (LÍU), rising oil prices are causing operational difficulties for the fishing industry. Fuel is its second highest cost item, after labor cost. Hjartarson said the price of one ton of fuel is now higher than USD 800 (EUR 543), five times the price ten years ago, Morgunbladid reports.
Additionally, high oil prices further inflation, reduce purchasing power and cause profit loss for companies that are heavily dependent on oil. “It is in fact diminishing our standard of living,” Hannes G. Sigurdsson, director of the economic department of the Confederation of Icelandic Employers (SA), told Morgunbladid.
Sigurdsson added that the long term effects of rising oil prices will cause other energy sources to be more apt to compete and more people to invest in fuel-saving vehicles.