The Irish Small and Medium Enterprise Association have warned of imminent job losses in the business sector as a direct result of soaring oil prices.

Their claim comes amid increasing fears of possible strike action by the haulage industry over the recent dramatic increase in fuel costs. The Association, it says, is receiving several calls on a daily basis from businesses outlining their concerns with several having indicated that if the situation continues they will have no option but to let people go.

"It is conceivable that the price of oil could hit 200 Dollars a barrel over the next number of months, which would be catastrophic to Irish businesses, particularly in light of our huge dependency on imported energy products. Due to fierce competition many companies do not have the option of passing increased costs onto their customers and therefore have to take the 'hit' on their bottom line," said ISME Chief Executive Mark Fielding.

While accepting that the Government can do nothing to influence oil prices, the Association maintains that it does have the capacity to influence the cost to the end consumer, and says that as the consumer and the business community bear the brunt of increasing oil prices it is the Government's coffers that continue to expand. On average the exchequer receives more than half (52%) of the end price of petrol and diesel in the form of excise duties and VAT. Any increase in the cost of oil products directly benefits the Government through a parallel increase in tax receipts Fielding recently called on the Government to ring fence from June 1st any additional revenues received from duties due to increasing oil costs. This fund, he says, should be off-set against any future carbon taxes, to cushion businesses against the twin impact of higher fuel costs and carbon taxes. Other measures, including increased research into alternative energy sources that would assist in reducing the cost of energy products should be investigated by the Government without delay.

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