Fuel prices set to rise sharply next week

Friday, 4 September 2026AI summary

💶 Finance 🏛️ Government #cost-of-living #government-policy

Fuel prices set to rise sharply next week — Photo: RTP Notícias

Diesel and petrol prices are expected to increase significantly next week due to rising oil costs linked to the conflict in the Middle East. In response, the government has announced a three-cent increase in the tax discount on petroleum products (Imposto sobre Produtos Petrolíferos or ISP) and is preparing further support for agricultural diesel.

Update: Fuel price hike details confirmed

Starting Monday, diesel prices will rise by 10.5 cents per litre, while petrol will increase by 8.5 cents. Government tax adjustments have slightly mitigated these increases by approximately three cents per litre.

Context & Explainers

The ISP (Imposto sobre Produtos Petrolíferos e Energéticos) is Portugal's excise tax on petroleum and energy products, charged as a fixed amount per liter on petrol, diesel, and other fuels. It is one of the main components of fuel prices at the pump, alongside VAT and the carbon tax (Taxa de Carbono).

The government can adjust ISP rates — temporarily or permanently — to influence fuel prices. Rate cuts are a common policy tool to ease cost-of-living pressures on drivers and transport businesses, though they also reduce government revenue.

For consumers, the ISP is significant because even small changes in the per-liter rate translate into noticeable differences at the pump, particularly for diesel users and commercial transport operators.