Higher fuel prices have put further pressure on Irish inflation, which climbed to 2.4 per cent in July, up from 2.1 per cent in June, according to the Central Statistics Office (CSO).
When the figures are broken down, fuel costs including electricity and gas saw the biggest prices rise in July, climbing by 10.9 per cent, the CSO figures, released this morning, indicate.
Inflationary pressures are unlikely to ease this month, with oil prices on international markets continuing to rise dramatically.
Oil surged to a new high of $66 a barrel this afternoon. US light sweet crude was up $1 at $65.90 at 4.40pm Irish time after hitting a record-high of $66.00. London Brent was up $1.55 at $65.54 after touching $65.66.
The small business lobby group Isme said the turnabout in Irish inflation could lead to consistently higher figures for the rest of the year.
Chief Executive Mark Fielding, the the figures were "disappointing but not unexpected and come on the back of the dramatic increases in oil prices".
"With oil prices at record highs and with many analysts predicting prices remaining at the current high levels or increasing further, the likelihood is that inflation will continue to increase in the coming months, with the resultant negative impact on the economy", he said.
The cost of oil has increased by 44 per cent in the last 12 months alone, leading to the almost 11 per cent jump in domestic fuels.
"The Government should immediately introduce a national energy policy to incentivise and promote alternative sources of energy to alleviate the impact of future oil prices on inflation", Mr Fielding added.
Labour Consumer Affairs spokeswoman Kathleen Lynch said Irish householders and families should prepare themselves for a "winter of discontent" as increases in the cost of oil and gas contribute to rising inflation:
"Today's Consumer Price Index shows that after June's slight fall, inflation is on the way up again," she said.
"As we approach the autumn and winter months the sharp rise in the price of oil is going to have a detrimental affect on many Irish households as they try to heat their homes."
The Green Party described today's inflation figures as yet another worrying economic statistic.
The party's finance spokesman Dan Boyle said the latest increase "along with rising oil prices, decreasing manufacturing output and lessening corporation tax returns" showed that "there were too many signs of the Irish economy going in a wrong direction for the Government to ignore."
Fine Gael's Phil Hogan said the "massive" fuel increases "are a clear indication that the Government's regulatory policy is not working . . . resulting in competitiveness difficulties for small businesses and higher prices for consumers".
The CSO's inflation figures showed both health and education costs climbing 6.5 per cent; transport and restaurants and hotels were up 3.2 per cent and 3.1 per cent, respectively.
The EU Harmonised Index of Consumer Prices (HICP) fell by 0.1 per cent in July, compared to a decrease of 0.4 per cent in July 2004.
The annual rate of inflation, as measured by the HICP, rose from 1.9 per cent in June to 2.2 per cent in July. According to the data, the cost of clothing and footwear fell by 2.5 per cent.