Portugal Renews Fuel Tax Cuts Amid Middle East Energy Crisis

Portugal has renewed temporary fuel tax cuts on petrol and diesel as the ongoing conflict in the Middle East continues to disrupt global energy markets and drive oil prices above $100 per barrel.

The extension was announced on March 14, 2026, as part of the government's effort to cushion consumers and businesses from volatile fuel costs driven by the closure of the Strait of Hormuz—a narrow shipping lane between Iran and Oman through which an estimated 90% of India's LPG and significant European energy supplies pass.

Global Energy Markets Under Pressure

Brent crude, the international oil benchmark, closed at $103.14 per barrel on March 13, up more than 42% since the conflict began in late February. Maritime data firm Lloyd's List Intelligence reported that only 77 ships crossed the Strait of Hormuz between March 1-11, down from 1,229 during the same period in 2025—a 94% drop.

Most vessels now making the crossing belong to shadow fleets used to circumvent Western sanctions, typically linked to Russia and Iran.

Portugal joins Serbia in implementing temporary fuel tax relief. Serbia cut fuel taxes by 20% through April 15, while Portugal's cuts apply to both petrol and diesel with no specified end date announced yet.

LPG and Natural Gas Supplies

While Portugal has not reported domestic LPG shortages, the global disruption has strained commercial gas supplies across Europe. India, heavily dependent on Gulf LPG imports, has seen widespread restaurant closures and panic buying, with some states reporting commercial cylinders meeting only 20% of demand.

Portugal's government has not issued similar warnings for domestic consumers, though monitoring continues as the geopolitical situation remains fluid.

What This Means for Expats

The fuel tax cut extends temporary relief you may have already seen at the pump. If you drive regularly in Portugal, you'll continue to benefit from reduced excise duties on petrol and diesel, though overall prices remain elevated due to global crude oil costs.

Keep in mind that Portugal's public transportation network—trains, metro systems, and buses—remains a cost-effective alternative as fuel prices fluctuate. Monthly passes and reloadable cards offer further savings if you live in Lisbon, Porto, or other major cities.

If you rely on LPG for home cooking and don't have access to piped natural gas (PNG), there's no indication of imminent domestic shortages in Portugal. However, commercial users—restaurants, hotels—are facing tighter supply conditions globally.

The government has not announced an end date for the fuel tax cuts, so they're expected to remain in place at least through the current period of energy market volatility.

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Related: [Cost of Living in Portugal 2026](#), [Public Transport Guide Portugal](#), [Energy Prices & Utilities 2026](#)