Petrobras has been under attack from all sides to forcefully reduce the prices of derivatives, mainly diesel and gasoline. Even the most absent-minded Brazilian knows that it is for electoral reasons.
President Bolsonaro has persecuted Petrobras by intimidating its board, changing its presidents, threatening with the suggestion of a CPI and continually using his “soft power” to wall up the company.
The president of the Chamber, Arthur Lira, threatened to increase taxes and change the State-owned Companies Law to allow greater political interference over the company.
Even Minister André Mendonça, of the STF, joined in the bullying, ordering that Petrobras provide detailed explanations about the criteria adopted for the company’s pricing policy, which should include reports, minutes, recordings, etc. And he charged Petrobras about its “social role”, ordering the National Petroleum Agency and Cade to present information on how they are inspecting the company.
The biggest enemy of the official bullies is the policy of Petrobras, which maintains a certain degree of parity with the international prices of derivatives (the “PPI”). When the price of derivatives rises abroad or when the dollar rises here, at the end of the day Petrobras readjusts prices. And it must be so, as I explained in this space last year.
If prices are determined by Tupiniquin bureaucrats disregarding international market quotations, there will be shortages, disorganization of the sector, billion-dollar losses to Petrobras’ shareholders and creditors and legal liability of administrators. To make matters worse, there is no guarantee that the consumer will pay less. The market is more powerful than the offspring of Sarney and Mercadante.
The more nonsense the pricing gang does, the more the dollar rises due to the flight of investors and, consequently, the more expensive gasoline and diesel become. That’s what has happened. They are champions of marksmanship in shooting in the foot.
His narrative is that Petrobras is being mean, profiting at the expense of the Brazilian. The proof of the crime would be in the growth of profit in this first quarter, of R$ 44 billion (compared to R$ 1 billion in the same period of 2021).
Commentators in the media have embarked on a fallacious thesis of the tabulators: a) that the increase in the company’s profits is responsible for the increase in the prices of derivatives, b) that the price of gasoline and diesel is the main cause of Brazilian inflation, and c) that Petrobras wants to end the country because of its unbridled greed. The convenient conclusion is that the company deserves to have its profits and prices fixed.
Nothing is mentioned about the international price of oil, the main driver of the company’s revenue, which rose from US$ 61 to more than US$ 100 a barrel in that period. Or that the prices of diesel and gasoline rose even more in the foreign market. Or even that the prices at the pump here are no different from what citizens of other countries pay, on average. Not even a mention of monetary injections, by the Fed and the Central Bank, the main causes of inflation in dollars and in reais, respectively. And, of course, not a word about the disastrous consequences of PT-era derivatives pricing.
Finally, it is evidence of opportunism that today’s tabulators loved the PPI when oil fell and remained below $40 during March, April and May 2020. The problem now is that the PPI stands in the way of their re-election.
The rise in derivatives and profits leads to the return of investments in the oil chain, which until this year was considered a villain by ESG apostles around the world. The growth of oil products production is the shortest path to lower prices. Petrobras should be left alone to fulfill what its statute provides: to produce, refine and commercialize oil and derivatives.
I have over 8 years of experience in the news industry. I have worked for various news websites and have also written for a few news agencies. I mostly cover healthcare news, but I am also interested in other topics such as politics, business, and entertainment. In my free time, I enjoy writing fiction and spending time with my family and friends.