Portugal's Galp confident it will find alternative markets if US tariffs bite

By Sergio Goncalves and Miguel Pereira

SINES, Portugal (Reuters) - Portuguese oil company Galp Energia's gasoline exports to the United States could be curtailed if U.S. President Donald Trump imposes tariffs on European goods, but the company is confident it can find alternative destinations.

Executive Board member Ronald Doesburg, who is in charge of industrial assets, told Reuters on Tuesday that if U.S. demand for gasoline drops as a result of higher prices stemming from the proposed 25% tariffs, Galp will be able to deal with it.

Galp's only refinery in Sines usually produces about 2 million metric tons of gasoline per year, of which between 1.2 million and 1.5 million tons are exported to the United States. The remainder is taken by the Portuguese market.

Trump has threatened to impose 25% tariffs on all European goods, raising the risk of a trade war that could prove damaging for export-oriented European companies.

"The energy market is global, gasoline streams are global, and hence our gasoline production will have sufficient flexibility to find its way to different markets," Doesburg said.

Tariffs would have an impact, "but it's an impact that will be managed ... We will look at our options", he said, adding that Galp has handled trade-related disruptions in the past and that Sines could be realigned towards different types of products, depending on prices and demand.

SUSTAINABLE AVIATION FUEL

In the meantime, Galp continues its shift towards greener fuels and expects to start producing biodiesel and sustainable aviation fuel from waste, such as used cooking oil, by mid-2026 at a unit it is building at its refinery, said Galp's head of hydrogen, Sergio Machado.

The 400 million euro ($432 million) Hydrogenated Vegetable Oil (HVO) plant, a 75% to 25% joint venture with Japan's Mitsui, will have annual production capacity of 270,000 tons and will be using green hydrogen from a 100 megawatt electrolyser that will cost 250 million euros.

"Our expectation is to have both units in production by mid-2026 and to reach cruising speed shortly thereafter," Machado said.

($1 = 0.9254 euros)

(Reporting by Sergio Goncalves; Editing by Andrei Khalip and David Goodman)