The cost of fuel and power rose almost 28 percent in a year, helping to propel the annual inflation rate to 3.9 percent, Government statistics show.

Consumer Price Index (CPI) figures for January show that year-on-year costs in the transport and vehicle sector also rose five percent, another illustration of how the soaring cost of crude oil — which topped $106 a barrel for a short time on Friday — is having a direct impact on the cost of living in Bermuda.

The rising "fuel adjustment" component of bills sent to households by electricity generator Belco is a symptom of what is happening on world energy markets. And so is the fact that gasoline prices on the Island rose 14.3 percent in the 12 months up to January 2008.

Food prices shot up 1.5 percent in the month from December to January, a reflection of the soaring cost of agricultural products around the world. The main items contributing to the monthly increase were eggs (up 7.2 percent), steak (up 1.6 percent) and milk (up 0.3 percent). Food prices have gone up by 3.5 percent over the past year. Consumers paid 3.9 percent more for the CPI basket of goods and services in January than they did 12 months earlier. The annual inflation rate climbed from 3.6 percent in December. Other sectors with the biggest 12-month price rises were health and personal care (6.4 percent), education, recreation and reading (4.3 percent) and tobacco and liquor (3.9 percent). Rents also rose 1.9 percent.

Despite the monthly rise of 2.5 percent for premium and mixed blend gasoline, and a 1.2-percent rise in vehicle maintenance costs, the transport and vehicle sector dipped 1.3 percent for the month. This was largely due to a 4.3-percent drop in foreign travel costs.

Beer drinkers saw a 2.8 percent climb in the cost of their favourite tipple between December and January and wine was also saw a monthly rise of 0.7 percent.

The cost of clothing and footwear dropped 0.6 percent for the month and 2.3 percent for the year, the only CPI sector untouched by the effects of inflation.