Any agreement by OPEC to increase oil supplies will be warmly welcomed by the authorities here. Rising oil prices have had a very large impact on the accelerating rate of consumer prices.

The world may be far less dependent on oil than it was in the 1970s, but it is still probably the most significant commodity in terms of determining price inflation across the developed world. Queues at petrol stations, double-digit inflation and resultant recessions may be things of the past, but policymakers still take oil price rises very seriously indeed.

Since a near tripling in oil prices to $30 a barrel, the US has been putting the oil-producing OPEC members under pressure to increase the quotas they are producing. Now it seems that good news on oil prices is very close and, as a result, consumer price indices across the world should fall back.

That would be good news for the new Irish national wage agreement, the Programme for Prosperity and Fairness. Some unions have already been saying that with inflation of 4.3 per cent, wage rises of around 5 per cent do not look overly generous.

Declining prices will also ease the concerns raised about the outlook for the Irish economy by EU institutions such as the Commission and the European Central Bank. Already there has been some rallying of equity prices and, according to many observers, that is likely to continue.

Most of the EU-wide inflation acceleration from 0.8 per cent to the latest average of 2 per cent is due to oil price crises. In Ireland, the oil price contributes about 1.4 percentage points of the 4.3 per cent inflation rate at the end of February.

But on top of this, according to Mr Jim Power, chief economist at Bank of Ireland, there is also the impact of rising oil prices on the cost of services, where inflation has also been rising.

Other sectors have also been facing difficulties. But the Irish Business and Employers Confederation points out that the problems created by the imposition of, for example, an energy tax would be worse.

In addition, all companies are facing the same increases in oil prices and the same competitive pressures. Nevertheless, the cost of oil has produced a fairly significant increase in input costs for manufacturers in particular. They often have very little pricing power and additional costs are often absorbed through narrower margins.