The average price paid in Portugal for each liter of diesel road traffic exceeded 2 euros per liter this week, reaching €2,024, already including the discounts made by the oil companies. This price published by the General Directorate of Energy and Geology (DGEG) is the highest in history — considering the average of the amounts paid and not the values ​​advertised on the pumps — and represents a 13 cent jump per liter compared to the average price of diesel seen last week. However, it was not accompanied by any downward adjustment of the tax on oil products, contrary to what had happened in previous weeks.

The consequence is that the amount of taxes paid for each liter of diesel has risen by just over 2 cents since the last week in which the Government readjusted the ISP rate (tax on petroleum products), in accordance with the refund of income tax proceeds that were passed after the initial effects of the invasion of Ukraine on fuel costs.

Weekly evolution of the average final price per liter of diesel (includes price before taxes, ISP and VAT)

Average weekly price calculated by the DGEG with discounts

Weekly evolution of the final average price per liter of gasoline (includes price before taxes, ISP and VAT)

Average weekly price calculated by the DGEG (with discounts)

As for gasoline, the reported average price remained practically unchanged (down 1 cent to 2,170 cents), but had registered a strong increase in the first week of June, above 11 cents per liter. Without adjusting the oil tax that week. The gain in cargo per liter is just under two cents per liter. These accounts are based on the evolution reported by the DGEG of the average final price of each week (every Tuesday) and that includes the variation of all components, including taxes.

The last downward correction of the tax on petroleum products occurred at the beginning of June and was only 0.5 cents for gasoline and 0.3 cents for diesel for road use. The Ministry of Finance determined that these unit rates would be in force for two weeks, “given the upcoming holiday calendar and that it does not allow a complete estimation of the market data.” Although the price data for international refined products are not affected by the holidays in Portugal.

Finance stated that it would review ISP fees on June 17 (towards the end of this week), but the size of the drop most likely also reflects the status of the checking account that was created to return earnings in revenue. tax. This current account seeks to correct the deviations between the Government’s forecasts —by which the tax reductions are determined— and the actually observed evolution of prices, which makes it difficult to anticipate tax variations.

This regime is complementary to the extraordinary oil tax reduction approved at the beginning of May, which will be in force at least until the end of the month, and which allowed for a more significant reduction in fuel prices. Although very conjunctural because it was quickly overtaken by the evolution of the prices of oil and refined products, accentuated by the devaluation of the euro against the dollar.

Average prices paid below the efficient price of the ERSE, but gasoline did not fall by the amount indicated by the regulator

Despite the record value reached at the beginning of this week, the average price of simple diesel with a bonus —2,024 euros per liter— remains below the average efficient price calculated by the Energy Services Regulatory Body for this week, which is 2,094 euros per liter. For gasoline, the efficient price of ERSE is €2.193 per liter, also above the average €2.17 for reduced prices calculated by the DGEG.

However, when comparing the weekly evolution verified between the efficient prices of ERSE and the average prices of DGEG, it is possible to find important differences. While diesel rose 13 cents considering the average price with discounts, the efficient price of this fuel increased less, 11 cents per liter. Even more disparate is the evolution in gasoline. The efficient price calculated by ERSE fell by 10 cents per liter, while the average price paid at the beginning of the week fell very little.

Although the efficient price for this week has already been announced, the comparisons made by the ERSE report between the efficient price and that practiced by companies refer to last week. And in that time period, the posted price on porches was 1.3 cents higher for gasoline and 1.4 cents lower for diesel. As for the average price with discounts disclosed by the DGEG, it remains below the efficient price estimated by the regulator, 1.9 cents for gasoline and 8.2 cents for diesel.