Latest news and stories about cost of living in environment in Portugal for expats and residents.
A new World Bank report projects that energy prices will increase by 23.6% in 2026 due to ongoing conflict in the Middle East. This rise is expected to be the highest since the start of the war in Ukraine, with significant impacts also anticipated for fertilizer and metal costs.
Electricity prices in the Iberian market are expected to remain stable due to the integration of renewable energy sources, particularly hydroelectric power. Pedro Amaral Jorge, president of the Iberian Electricity Market (Mercado Ibérico de Eletricidade or MIBEL), stated that the focus is on increasing price predictability for consumers. He also argued against taxing extraordinary corporate profits.
MIBEL (Mercado Ibérico de Eletricidade) is the integrated electricity market shared by Portugal and Spain. It allows for the cross-border trading of electricity, aiming to increase competition and price stability for consumers in both countries.
The Portuguese Association of Insurers (APS) announced that insurance companies have paid 359 million euros in compensation for damages caused by severe storms in January and February. Total covered damages are projected to reach 1.086 billion euros, with over 100,000 claims already processed or partially settled. The storms caused significant destruction across the central zone of the country.
G7 finance ministers, including Portugal's Joaquim Miranda Sarmento, decided not to release strategic oil reserves despite prices rising near $120 per barrel due to Middle East tensions. Sarmento warned that releasing limited reserves would only provide temporary relief and should be saved for actual emergency supply disruptions. Portugal currently maintains reserves covering approximately 90 days of consumption, which the government views as a vital buffer against total supply failure. Drivers and residents should be aware that fuel prices may remain volatile as international markets react to the closure of the Strait of Hormuz.
Update: Diesel prices see historic 20-cent daily surge
Fuel prices in Portugal experienced a significant jump this Monday, with diesel (gasóleo) increasing by 20 cents per litre, surpassing the price of petrol for the first time since 2022. While Brent crude prices fluctuated wildly, touching $119 before closing near $99, the immediate impact at Portuguese pumps reflects the high volatility in global energy markets.
Joaquim Miranda Sarmento is Portugal's Finance Minister in the AD government led by Luís Montenegro. An economist and professor at ISEG (Lisbon School of Economics & Management), he served as PSD parliamentary group leader before joining the government.
As Finance Minister, he oversees the state budget, tax policy, public debt management, and fiscal relations with the EU. His decisions on tax brackets, IRS withholding tables, housing incentives, and public spending directly affect residents' cost of living and investment climate.
Environmental association Zero said Portugal remains highly exposed to international oil-market swings and urged faster electrification and investment in public transport to reduce fossil-fuel dependence. The group linked fuel-price rises to higher inflation and cost-of-living pressures, calling for policy steps to shield households and improve competitiveness. Those tracking energy and transport costs should watch national and local plans for public-transport electrification.
Update: Brent up 25%; crude could hit $150
Recent market moves have pushed Brent nearly 25% higher since the start of the latest Middle East hostilities; some analysts say the barrel could top $100 and might reach $150 if production is disrupted further, a prospect that would put additional upward pressure on fuel prices and inflation.
Zero is a Portuguese environmental NGO that tracks energy use, emissions and climate policy; in 2025 it reported electricity consumption reached 53.1 TWh and that increased reliance on gas raised CO2 emissions by about one million tonnes. Its analyses shape public debate and policy on the energy mix, which influences electricity costs, climate targets and regulatory changes that affect households and businesses.
