With the policy of reducing fuel prices on the eve of the elections promoted by President Jair Bolsonaro (PL), drivers already pay less than R$3 for the ethanol book at gas stations in São Paulo.
Considering the price of R$ 2.97 per liter of ethanol practiced at stations in the south and west of São Paulo, the fuel accumulates a decrease of about 48.5%, compared to the average level of R$ 5.77 in December 2021, according to Ticket Log data.
The sharp drop in prices began at the end of June, when Congress approved federal tax exemptions and a cap on the ICMS (Tax on the Circulation of Goods and Services) rate on fuel.
There was also a natural correction after the 56.5% rise in ethanol last year, driven in the period by the return of mobility and by the increase in demand with the relaxation of restriction measures due to the pandemic.
The decline has been accelerated – in mid-August, the ANP survey pointed out that the average price of ethanol had just returned to costing less than R$4 per liter.
The most recent data from the ANP (Agência Nacional do Petróleo, Gás e Biocombustíveis) indicated that the average price of hydrous ethanol in the country had fallen by 3.4% in the week ended September 2, in relation to the immediately previous one, to R$3 .71 per litre.
The price of gasoline fell by another 1.5% at Brazilian stations in the first week of September, to R$5.17 per liter, in line with the drop in oil prices on the international market with the growing risk of global recession, and the announcements of fuel reduction by Petrobras.
Changes in strategy at Petrobras
The government is counting on falling fuel prices to reverse damage to its image caused by the escalating inflation at the beginning of the year. The move wreaked havoc on the image of President Jair Bolsonaro (PL), who first tried to blame the states, and then went on to talk about privatization of Petrobras, which led the CVM (Securities Commission) to open investigations into the company. .
Appointed to head Petrobras with the mission of holding prices down, Caio Paes de Andrade has had his work made easier by the drop in international prices, in response to fears of global recession and new lockdowns in China.
In a note distributed on September 1, when it announced the latest reduction in gasoline, Petrobras said that the reduction follows the evolution of reference values and “is consistent with its pricing practice, which seeks to balance prices but without the transfer immediate effect of volatilities in international quotations and the exchange rate”.
Although the cuts follow international quotations, Petrobras has increased the frequency of public notices announcing the readjustments. The change began in July. The company says it wants to increase transparency.
Survey carried out by the OSP (Observatório Social do Petróleo) at the request of the Sheet shows that Petrobras adopted different fuel pricing strategies in times of high and low international oil prices in 2022.
When oil rose, the company carried out fewer readjustments and practiced prices below international quotations, keeping the transfer to the pumps. With oil falling, he began to announce frequent reductions and follow the foreign market more closely.
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