Portuguese Drivers Face a 13.5-Cent Diesel Jump This Week as Strait of Hormuz Tension Lifts Crude
Diesel is set to rise about 13.5 cents a litre and petrol 6.5 cents in the week of 20-26 July, the Automovel Club de Portugal forecasts, pushing average prices close to two euros a litre. The cause is climbing crude on Middle East tension near the Strait of Hormuz. A government ISP tax discount is s
Drivers in Portugal face a sharp jump at the pump this week. From Monday, the price of diesel is set to rise by about 13.5 cents a litre and petrol by roughly 6.5 cents, according to forecasts from the Automóvel Club de Portugal (Automobile Club of Portugal, or ACP). The increase pushes both fuels close to the psychologically painful two-euro mark.
On the ACP’s projections, the average litre of diesel would reach around €1.988 and petrol about €1.980 for the week of 20 to 26 July. Those are averages, so many stations — particularly on motorways — will charge more, while low-cost outlets may sit a little below.
Why prices are climbing
The driver is the price of crude on international markets, which has been climbing on renewed tension in the Middle East. An escalation between the United States and Iran, including strikes near the Strait of Hormuz — the narrow waterway through which a large share of the world’s oil passes — has spooked traders. Brent crude, the benchmark used in Europe, was trading near 81 dollars a barrel, up around 4 percent over five days.
Because Portugal imports virtually all of its fuel, moves in the global oil price feed through to the pump within days, with a lag of about a week. The ACP cautions that its estimates can still shift depending on how crude and refined-product prices move through Friday’s trading.
The government’s cushion
To soften the blow, the government keeps two mechanisms in place. The first neutralises the extra VAT (value-added tax) the state would otherwise collect when prices rise, so Lisbon does not pocket a windfall from higher pump prices. The second is a discount on the Imposto sobre os Produtos Petrolíferos (Tax on Petroleum Products, or ISP), which the government has pledged to widen whenever weekly increases top 10 cents — a trigger that has been active since the latest Middle East flare-up.
According to António Leitão Amaro, the Minister of the Presidency, the ISP relief amounts to about six cents a litre on diesel — worth some 7.4 cents once the knock-on tax effects are counted — and 4.6 cents on petrol, or roughly 5.7 cents with tax included. Without that support, the rise this week would be steeper still.
What it means for households
For anyone who commutes by car or runs a small business on the road, the increase adds up quickly: filling a typical 50-litre diesel tank now costs close to €100. Fuel prices have swung repeatedly this year — diesel jumped 17 cents in one week back in March, then fell 12 cents in June — and the latest spike underlines how exposed Portuguese wallets remain to events thousands of kilometres away. Drivers who can may want to fill up before Monday, or hunt out the cheaper stations that the ACP and government price comparators track.
