Enda Kenny (Mayo, Fine Gael)
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Question 174: To ask the Minister for Finance the estimated impact on the economy here of a barrel of oil priced at $60, $65, and $70; the extent of reliance of Ireland's energy needs on oil; the current reserves available to the country; and if he will make a statement on the matter. [23107/05]

Brian Cowen (Laois-Offaly, Fianna Fail)
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Economic model simulations suggest that, holding other factors constant, each sustained $10 per barrel rise in the price of oil reduces growth in the Irish economy by about 0.5 percentage points in a full year, relative to baseline. It should be noted, however, that because oil has not in the past risen to a level as high as $70 per barrel, it is difficult to accurately simulate such a scenario.

The dependency of the economy on oil has declined over the last number of years, for example, imports of oil amounted to 1.5% of GDP last year; in the late 1970s, the equivalent figure was around 6.5% of GDP. This lower oil dependency has been due to a number of factors such as the greater relative importance of services in the economy, which are less energy intensive, the growth in natural gas and other energy sources and more efficient use of energy.

As a member of the International Energy Agency, IEA, Ireland is required to maintain oil stocks equivalent to at least 90 days of net imports in the previous year. At 1 May 2005, Ireland held 2,304,000 tonnes of oil, which is equivalent to 102 days of net imports using the IEA methodology and this is 12 days above the obligation of 90 days.