Even after the cut, gasoline remains more expensive in Brazil than abroad

Even after the 4.8% cut announced by Petrobras this Monday (15), the price of gasoline in Brazilian refineries remains above import parity, a concept used by the state-owned company that simulates how much it would cost to bring the product from abroad.

According to calculations by Abicom (Brazilian Association of Fuel Importers), the average price of the product in the country’s refineries was R$ 0.27 per liter above par at the opening of the market this Tuesday (16), already considering the drop announced by Petrobras .

This means that there is still scope for further cuts, if international oil prices and the exchange rate do not soar. Petrobras has repeated that it prefers not to pass on momentary volatilities to the Brazilian consumer.

The 4.8% cut, which came into effect on Tuesday, was the third in less than a month, with an accumulated reduction of 13%, the R$ 0.53 per litre. The company says that the movement follows the fall in international oil prices.

The movement helps the campaign for the re-election of President Jair Bolsonaro (PL), whose popularity was affected by the rise in fuel prices since the end of the hardest period of isolation of the new coronavirus pandemic.

In May, gasoline and diesel prices reached historic records at Brazilian gas stations, a movement that culminated in the resignation of two Petrobras presidents in just over a month.

The government also decided to face states in Congress and passed a law limiting ICMS rates to 17% and 18%. Federal taxes on fuel were also zeroed.

Since the end of June, when the ICMS law was passed, the price of gasoline has been falling sharply at pumps. In the first half of August, according to electronic payments company ValeCard, it fell by 9.16% compared to the July average, reaching R$5,779.

The ANP (Agência Nacional do Petróleo, Gás e Biocombustíveis) has not been publishing its weekly fuel price survey, the main indicator on the subject, due to a hacker attack on its systems.

With the sequence of drops at the pumps, Bolsonaro has been repeating that Brazil will soon have one of the cheapest gasoline in the world. But data from the specialized website Global Petrol Prices indicate that the country has not been advancing in the ranking, as the product has also become cheaper in other countries.

In the latest ranking update, published on August 8, Brazil ranked 51st in a list of 169 countries. It’s a worse ranking than the 47th place seen a month earlier. As the prices are converted to the dollar, however, the exchange variation also has an effect on the comparison.

The Global Petrol Prices list brings Brazil with an average resale price of US$ 1.15. The 20th place, Oman, had an average price of US$ 0.62. The 30th, Afghanistan, at $0.97.