The Portuguese Government announced on October 7 that it will strengthen the sanctioning powers of the Energy Services Regulatory Authority (ERSE) over the entire fuel value chain, including refining, but did not commit to a deadline for the measures to take effect. The Minister of Environment and Energy, Maria da Graça Carvalho, rejected imposing limits on fuel margins, arguing that the focus of support should center on the most vulnerable sectors and that market intervention should only be used as a last resort.
The oil sector specialist Agostinho Pereira de Miranda considered that the Government should "seriously consider" limiting refining, distribution, and retail margins, using a temporary mechanism provided for by law. The lawyer also criticized ERSE's report on price formation, stating that the entity answered only four of the eight questions asked by the minister and that the study "would not pass a test" due to its deficiencies. Pereira de Miranda also highlighted structural problems in the sector, such as the lack of competition and regulatory architecture that was never corrected.
ERSE, led by Pedro Verdelho, concluded in its study on fuel price formation and evolution that there are no signs of irregularities in the national market and that there are no reasons for setting maximum prices or margins. However, Pereira de Miranda noted that Galp's refining margins rose 175% in the second quarter, reaching almost 17 dollars, and criticized that the reference price formation model in Portugal has never been justified, pointing out that freight and storage included in the calculations should not exist when products come from Sines instead of Rotterdam.
The specialist also warned that allowing a Spanish operator to acquire 80% of national refining capacity should be "forbidden territory," referring to the merger between Galp and Moeve, an operation that will integrate the refineries of both companies in a company owned 20% by Galp and the rest by the Spanish. The rise in fuel prices, with diesel rising ten cents and gasoline eight cents, prompted public reactions and led the Government to stress that it is not profiting from the situation, having used all the increase in VAT revenues to offset the excise duty on petroleum products, totaling 700 million euros.
