LISBON, Sept. 21 (Xinhua) -- Fuel prices in Portugal reached all-time highs on Monday, with diesel and petrol prices rising by approximately 6.5 euro cents (0.07 U.S. dollars) and 5 euro cents (0.06 dollars)per liter respectively, even after the application of the government's ISP fuel excise tax discount mechanism, Portuguese media reported.
Since the start of the Middle East conflict, the price of diesel has risen by more than 60 euro cents (0.69 dollars)per liter and petrol by around 44 euro cents(0.5 dollars), driven by the war in Iran, geopolitical tensions in the region, the closure of the Strait of Hormuz, through which 20 percent of global oil and gas trade passes, and attacks on refineries in the context of the war in Ukraine.
Finance Minister Joaquim Miranda Sarmento acknowledged that fuel support measures will remain in place "for some time," conditioning any reassessment on the evolution of the Middle East conflict. He defended income support measures over cuts to energy VAT.
The government has extended a 10 euro cents per liter subsidy on professional diesel through the end of the year and relaunched targeted support for taxis, firefighters and the social sector in a package of 38 million euros (43.7 million U.S. dollars).
It also plans to propose to parliament the extension through Dec. 31 of the temporary regime allowing ISP rates on petrol and diesel to be reduced to offset the additional VAT revenue generated by higher fuel prices. ■
