The average price of a litre of petrol or diesel is cheaper now than at any time since March 2010, according to the AA’s Fuel Price Index.
However, the organisation said that prices would be significantly cheaper if the Government removed “emergency era taxes”.
The falling price of oil internationally has been dramatic since the middle of last year, when it was holding above $100 per barrel.
It is now trading at a little over $36.
However, that fall of two-thirds does not translate into a two-thirds reduction in pump prices for Irish drivers.
Petrol now costs an average of 129.5c - 12.9c cheaper than it did this time last year.
Diesel prices also tumbled and are now at 118.2c - 15.8c down on last Christmas.
Oil is bought in US dollars, so that the Irish price is dependent on the relative strength of the euro.
The single currency has dropped by 20 per cent against the dollar since the middle of last year - from 73.5c to the dollar in July 2014 to 91c in December 2015.
Fuel taxes in Ireland are charged by the litre, so when the price falls the taxes do not.
Starting with the emergency budget of October 2008, there have been five separate tax increases on fuel since 2008, adding about 20c and 18c to a litre of petrol and diesel respectively.
The effect is that 91c in the price paid for a litre of petrol is tax and 77c in the price of diesel is tax.
‘Emergency era taxes’
"If it weren't for these emergency era taxes we would be looking at about 109.72c for petrol and 100.52c for diesel and would potentially save about €403 and €360 on motorists' petrol and diesel bills each year," AA's consumer affairs director Conor Faughnan said.
“There’s no reason why these taxes shouldn’t be removed - the emergency is over and so is the time for emergency taxes,” he said.
“The big story has been the collapse of world oil prices.
“It may be good news but we are not feeling the full benefit of it for two reasons. Firstly, the euro has weakened against the dollar.
“Secondly, we are still stuck with paying enormously high fuel taxes imposed during the financial crisis and stubbornly retained by the Government.
“If oil continues its current pattern we could see fuel prices continue to fall well into 2016,” he said.
“Because fuel taxation is already worth an estimated €2billion to the Irish exchequer, looking to the year ahead we would like to see the Irish government remove those extra taxes and put the money back into motorists’ pockets.”
