Portugal’s finance chief cautions that while a 2026 budget deficit cannot be ruled out if shocks hit, the government remains pledged to balanced public finances and debt reduction.

Officials warn the fiscal outlook is tighter amid higher energy costs and regional conflict, but the stance on balancing the books and cutting debt stays central, with readiness to respond to economic shocks.

He stresses that responsible public finances will be pursued, yet a deficit remains possible in the face of emergencies or major external events.

Eurogroup ministers in Brussels discuss the economic fallout from the conflict, focusing on energy, inflation, and a renewed EU energy risk.

A temporary discount on fuel could apply to gasoline if price criteria are met, notably when the price exceeds a 10-cent threshold from March 6.

Surging energy and oil prices driven by storms and the Middle East conflict tighten the 2026 macro path, narrowing the margin for error.

Despite solid 2025 performance, renewed price spikes in natural gas and oil have rekindled concerns about fiscal trajectories.

Rising gas and oil costs are reshaping expectations, with earlier optimism from 2025 now tempered by new shocks.

Brussels has not objected to Portugal’s temporary 3.55 eurocents per liter diesel excise cut, as a crisis-response measure.

A temporary ISP tax discount on petrol is reintroduced to mitigate fuel price increases, and officials expect no EC objections given its exceptional, time-limited nature.

Officials decline to speculate on the European Central Bank’s next moves amid the current context.

The government informed the European Commission about the measure, aligning with EU rules that crisis-period energy support must be targeted to the vulnerable and compliant with competition/state aid rules.