Why Fuel May Get Pricier in Portugal, Possible Fuel Tax Cuts Changes

Fuel pumps across Portugal are bracing for another uptick, a trend that is likely to resonate with anyone budgeting a road-trip or a daily commute during the first weeks of summer. Forecasts released by the country’s main motoring club and confirmed by provisional government data point to noticeably dearer fill-ups over the coming days, especially for diesel users.

A New Round of Increases

Starting Monday, the cost of regular diesel is expected to climb to roughly €1.616 per litre, about eight cents higher than last week’s nationwide average, according to calculations by the Automóvel Club de Portugal (ACP). Unleaded 95-octane petrol should edge up three cents, pushing the average price to about €1.722 per litre, figures compiled by the Directorate-General for Energy and Geology (DGEG) show.

Why the Jump?

International benchmarks for refined fuels have been on a gentle but steady rise since mid-May, largely on the back of higher summer demand within the European Union and tighter production quotas from major oil-exporting nations. Portuguese forecourts normally translate those market movements into retail prices with a delay of roughly one week, which explains the sudden catch-up now visible at the pump.

The Tax Cushion—and Its Limits

Lisbon still maintains a package of temporary tax breaks first introduced during the 2022 energy shock. The mix includes a lower ISP (the domestic excise duty on petroleum products), an offsetting mechanism that returns extra VAT revenue to motorists, and a suspension of the annual carbon-tax hike. Without that trio of measures in place, today’s projected prices would be about 14 cents higher for petrol and 17 cents higher for diesel, Treasury officials estimate.

How Portugal Compares

Even with the latest increases, Portuguese motorists remain somewhere in the middle of the EU price table. The most recent European Commission bulletin shows Spain a shade cheaper on petrol but slightly more expensive on diesel, while France and Italy charge between 10 and 18 cents more per litre across the board. In practical terms, filling a 50-litre diesel tank in Portugal next week should cost around €80—that is still €4 below the French equivalent but €2 above the Spanish one.

What This Means for Foreign Residents

Expats who use a private car for regional travel—or who plan to drive from Lisbon to the Algarve during peak season—should factor the new prices into their summer budget. Toll-free alternatives to the main A2 and A1 motorways remain available but add time and fuel consumption. Meanwhile, public-transport operators have left their fares unchanged, and monthly Navegante passes in the Lisbon metropolitan area still start at €30, making rail or bus commutes an increasingly attractive hedge against volatile fuel costs.

The Road Ahead

Energy analysts contacted by Público and Rádio Renascença expect wholesale prices to stabilise in mid-July, provided crude markets remain calm. That outlook could translate into smaller adjustments—or even a pause—in retail prices later in the month. However, any decision by the government to scale back the current tax relief would override market trends and push prices higher overnight, a scenario officials insist is off the table until at least autumn.