Diesel and petrol prices jump in Portugal: find out what you’ll pay from Monday
Diesel and Petrol Prices Jump in Portugal: What Drivers Need to Know
Diesel and petrol prices jump in Portugal as the nation prepares for another round of fuel cost increases. Starting Monday, July 20, motorists across the country will face higher prices at the pump. The Automóvel Clube de Portugal (ACP) and the Directorate-General for Energy and Geology (DGEG) have released updated forecasts indicating significant rises in both diesel and petrol costs. Diesel is projected to climb by 13.5 euro cents per litre, while petrol will see an increase of 6.5 euro cents. These adjustments mean diesel will reach €1.988 per litre and petrol will be priced at €1.980 per litre for consumers.
Global Factors Driving Fuel Costs Higher
The ACP explains that these average figures reflect raw material prices at the close of markets last Thursday. However, they caution that fluctuations may still occur until Friday as crude oil and fuel markets continue to react to international developments. The ongoing conflict in the Middle East, involving the United States, Israel, and Iran, remains a primary driver of rising energy costs. This geopolitical tension has sent shockwaves through global markets, affecting not only oil prices but also fertilisers and other essential commodities.
The Strait of Hormuz, a critical waterway through which 20% of global oil and natural gas trade passes, was initially closed following the commencement of hostilities between the US, Israel, and Iran on February 28. This closure has given Iran considerable leverage in international negotiations while simultaneously pushing prices well beyond regional boundaries. The government has committed to implementing an extraordinary and temporary reduction in the ISP (Tax on Petroleum and Energy Products) whenever price increases exceed 10 cents per litre.
"The minister asked for a detailed study of the past two years to explain why falls in oil prices on international markets take so long to be reflected in pump prices," reports Expresso.
Government Response and Market Investigation
Escalation in the fighting between the conflicting parties this week has brought an end to the provisional agreement aimed at halting the war against Iran. In response to growing public concern, the Minister for Environment and Energy, Maria Graça Carvalho, has taken action. According to the newspaper Expresso, on Thursday she sent a formal request to ERSE for comprehensive inspections of fuel prices charged by petrol stations since 2024.
The minister's letter specifically calls for a detailed study covering the past two years, to be completed within 20 days. This investigation aims to uncover why reductions in international oil prices are not being passed on to consumers in a timely manner. Such delays in price transmission have frustrated drivers and sparked debate about potential regulatory interventions.
Meanwhile, the question of reducing VAT on fuel continues to generate discussion among policymakers. Finance Minister Miranda Sarmento addressed this issue during Wednesday's parliamentary debate, firmly stating that he will not alter the current tax rate. This position reflects the government's broader approach to managing public finances while addressing immediate consumer concerns about rising energy costs.