Uncertainty around Iran 'drove up energy costs'
Political uncertainty over developments in Iran was the main driver behind a rise in energy costs last month.
Prices were 1% higher in January than in December due largely to higher oil costs as a result of uncertainty around the Iranian response to EU sanctions, including the possible closure of the Straits of Hormuz, which is one of the most important shipping channels for oil.
When compared with this time last year, energy prices were 8% higher in the first month of the year.
Power trader at Bord Gáis Energy John Heffernan said that although the unseasonably mild weather saw a fall in demand for electricity, gas and coal, developments in global politics drove prices up.
"The markets were a little fearful of supply disruptions to oil if the Straits were closed," he said.
"The second reason (for the increase) is that there are tentative signs that risks to the world economy are receding and that growth might exceed expectations in 2012."
