The prices of fuel started this week with varied trends: gasoline became slightly cheaper, whereas diesel prices increased, according to the updated average values released on Tuesday by the Directorate-General for Energy and Geology (DGEG).
The price for 95 octane unleaded gasoline decreased from 1.734 euros per liter to 1.723 euros per liter between Friday and Monday, a drop of 1.1 cents.
Meanwhile, simple diesel increased from 1.608 euros per liter to 1.632 euros per liter over the same period, a rise of 2.4 cents.
Forecasts had indicated a three-cent increase for diesel and a one-cent decrease for gasoline.
How is oil trading on international markets?
The price of a barrel of Brent crude for January delivery ended Monday in the London futures market with an increase of 1.29%, reaching 63.37 dollars.
Brent crude, a European benchmark, closed the session on the Intercontinental Exchange trading at 81 cents above the 62.56 dollars it had closed at on Friday.
Brent began the week on a positive note amid investor optimism over a possible reduction in the benchmark interest rate by the Federal Reserve in December, which overshadowed expectations of a peace agreement in Ukraine and the potential easing of sanctions on Russian oil companies.
Analyst Razan Hilal noted in her weekly commentary that geopolitical risks persist in the region, with “attacks on refineries, pipelines, and Russian energy infrastructure” by Ukrainians.
End of ISP discount? Brussels “has not yet imposed any deadlines”
Finance Minister Joaquim Miranda Sarmento stated that the European Commission “has not imposed any deadline” for ending the discount on the Tax on Petroleum and Energy Products (ISP), which will be gradual to avoid price hikes.
“The Commission, for now, has not imposed any date, no schedule, but has continued to emphasize that Portugal, among other countries – I believe there are about 10 more – needs to reverse these fuel tax discounts,” said Joaquim Miranda Sarmento.
Speaking to Portuguese journalists in Brussels after the EU finance ministers meeting, the minister indicated that “the end of the ISP discount, the reversal of the ISP discount, will be as gradual as possible.”
“Therefore, we cannot anticipate when it will phase out or its conclusion,” Joaquim Miranda Sarmento noted.
Following criticism from Brussels, since 2023, the government is now starting to gradually withdraw the benefit related to the ISP.
The issue at hand involves discounts on ISP when purchasing gasoline and diesel, which were supports created in 2022 and 2023 due to the energy crisis linked to the war in Ukraine and high inflation.
The government did not include in the 2026 State Budget proposal (OE2026) any provision for the elimination of these discounts and has already signaled that the process should be gradual.
The Ministry of Finance has assured that it is working on a solution that will not raise fuel prices, stating it will begin to phase out the benefit when prices decrease.
This action arises due to the European Commission’s recommendations to reduce these discounts as they are exceptional measures aimed at mitigating the impact of rising fuel prices.
The repeal of the current ISP discount and the update of the carbon tax could generate an additional 1.132 billion euros in revenue for the state, according to estimates by the Public Finance Council.
