Petrobras’ board meets this Thursday to discuss prices

The chairman of Petrobras’ board of directors, Marcio Weber, convened the collegiate for an extraordinary meeting this Thursday (16) to discuss fuel prices, a topic of dispute between the government and the state’s management.

Details of the agenda were not disclosed, but sources expect the presentation of a proposal to hold readjustments. The invitation sent to the other ten directors only says that the meeting will “deal with the subject of ‘Price Increases'”.

With gasoline prices and, especially, diesel prices well below international quotations, Petrobras has been signaling that it will make adjustments, but is pressured to hold back increases while the government rushes to approve a package of measures to benefit the consumer.

On Wednesday (15), Congress concluded the vote on a bill that establishes a ceiling for ICMS rates on fuel, which can reduce the average price of gasoline by R$ 0.657 per liter, according to a projection by consultant Dietmar Schupp.

Next week, Congress debates the so-called PEC for fuels, which authorizes the government to zero federal taxes on gasoline and compensate states that were willing to reduce the ICMS tax on diesel and cooking gas.

With the measures, President Jair Bolsonaro (PL) expects a total reduction of R$ 2 per liter in the price of gasoline. The price of diesel would fall by R$1, according to the president’s accounts.

During the week, the government tried to convince Petrobras to avoid readjustments at this time, so that the benefits reach the consumer’s pocket before new increases in refineries overshadow the effects of the tax reduction.

The fuel sector claims, however, that the transfer will take time, since the distributors have stocks purchased at current rates. The benefit, however, depends on the renewal of stocks, which should take place entirely in ten to fifteen days.

Petrobras declined to comment on the matter. Last week, in response to news about the pressure to hold prices, the company released a note reinforcing the defense of its trade policy, which provides for the monitoring of international quotations.

“The practice of competitive prices and in balance with the market is a necessary condition for the country to continue being supplied without risk of shortages by the various agents”, says the company, which has been warning the government of risks of lack of products in the second half.

The decision for readjustments does not depend on the approval of the board of directors. It is taken by a committee formed by the president of the company, José Mauro Coelho, and by the directors of Finance and Commercialization and Logistics, Rodrigo Araújo and Cláudio Mastella.

Coelho was fired by Bolsonaro at the end of May. His replacement, Caio Paes de Andrade, however, needs to be approved at a shareholders’ meeting, which still has no date to take place.