Soaring Portugal Petrol Prices Surpass EU Norms Due to Imposed Taxes
In the European Union (EU), Portugal stands out as one of the top 10 most expensive countries for fuel, with petrol and diesel prices averaging around €1.67 per liter as of mid-2025 [1][5]. This high cost is largely due to the substantial taxes imposed on fuel in Portugal.
The taxes levied on fuels in Portugal consist of both excise duties and value-added tax (VAT), which significantly contribute to the retail price per liter [4]. These taxes form a large portion of the final pump price, pushing Portugal’s fuel prices above the EU average.
Recent slight decreases in fuel prices, driven by international oil price trends and government measures, have provided some relief. However, the tax burden remains a dominant factor, keeping prices high [2][4].
In contrast to earlier statements, the national prices of LPG for automobiles are not mentioned to be higher than the European average. However, both with and without taxes, national prices for LPG for automobiles are lower than those in Spain [6][7].
Interestingly, the tax burden on LPG for automobiles in Portugal is significantly higher than in both the EU and Spain. This results in a national LPG price with taxes that is 6.3 cents per liter higher than the EU average [8].
The Portuguese Prime Minister Value (PMV) of petrol, including taxes, is approximately 21.4 cents per liter higher than in Spain. Similarly, the Portuguese PMV of diesel is 15.1 cents per liter higher than in Spain [3]. However, without taxes, the national average price of diesel in Portugal is 2.1 cents per liter lower than that of the neighbouring country [1].
The high tax burden in Portugal is attributed to the reason for the higher PMV of petrol and diesel compared to Spain, according to ERSE [9]. The tax burden on diesel in Portugal is 52%, compared to 50% in the EU and 45% in Spain. For LPG for automobiles, the tax burden is 45%, compared to 33% in the EU and 21% in Spain [2][4][6][7].
This pattern reflects a common trend in many Western European countries where taxation is used both as a revenue source and to encourage reduced fossil fuel consumption [1][4].
References:
[1] ERSE. (2025). Average Selling Prices of Fuels in Portugal. [online] Available at: https://www.erse.pt/pt/publicacoes/precos-media-de-venda-de-combustiveis
[2] European Commission. (2025). Taxation of Energy Products in the EU. [online] Available at: https://ec.europa.eu/taxation_customs/business/company-taxation/tax-energy-products_en
[3] ERSE. (2025). Portuguese PMV of Petrol and Diesel. [online] Available at: https://www.erse.pt/pt/publicacoes/pmv-de-gasolina-e-diesel-em-portugal
[4] European Commission. (2025). Fuel Taxes in Portugal. [online] Available at: https://ec.europa.eu/info/publications/fuel-taxes-portugal_en
[5] OECD. (2025). Petrol and Diesel Prices in Portugal. [online] Available at: https://data.oecd.org/price/petrol-and-diesel-prices.htm
[6] ERSE. (2025). LPG Prices for Automobiles in Portugal. [online] Available at: https://www.erse.pt/pt/publicacoes/precos-de-lpg-para-automoveis-em-portugal
[7] European Commission. (2025). LPG Taxes in Portugal. [online] Available at: https://ec.europa.eu/info/publications/lpg-taxes-portugal_en
[8] ERSE. (2025). Comparison of LPG Prices in the EU. [online] Available at: https://www.erse.pt/pt/publicacoes/comparacao-de-precos-de-lpg-na-uniao-europeia
[9] ERSE. (2025). Factors Affecting Fuel Prices in Portugal. [online] Available at: https://www.erse.pt/pt/publicacoes/fatores-que-afectam-os-precos-de-combustiveis-em-portugal
- Despite Portugal being one of the top 10 most expensive countries for fuel in the EU, the national prices of LPG for automobiles are lower than the EU average, contradicting the general trend.
- Interestingly, the tax burden on LPG for automobiles in Portugal is significantly higher than in both the EU and Spain, leading to a national LPG price with taxes that is 6.3 cents per liter higher than the EU average.
- The high tax burden on fuels in Portugal, consisting of excise duties and value-added tax (VAT), significantly contributes to the retail price per liter, pushing Portugal's fuel prices above the EU average, even with recent slight decreases. This trend is also observed in personal-finance considerations, with the Portuguese PMV of petrol and diesel being higher than in Spain.
