Remember the four presidents of Petrobras in the Bolsonaro government

In his four years in office, President Jair Bolsonaro had a conflicting relationship with Petrobras, Brazil’s largest state-owned company. Amid the escalation of fuel prices, he complained about the company’s management, its shareholders and even the laws that make the company operate with market prices.

Since the Fernando Collor de Mello government, it was the mandate that had the most changes in command at the state-owned company — former president Fernando Henrique Cardoso also had four presidents of Petrobras, but in two terms.

And they were, in general, troubled exchanges, with the right to dismissal by social networks, retreat in nomination after internal questioning and trampling of the company’s governance rules to elect close allies.

The clumsy way in which Bolsonaro dealt with the company resulted in days of extreme volatility with the company’s shares and the opening of administrative proceedings by the CVM (Securities and Exchange Commission) for failures to disclose material facts.

Remember who the presidents of Petrobras were, the conflicts with Bolsonaro and how the command change processes were at the state-owned company:

Roberto Castello Branco (Jan.19 to Apr.21)

The longest-serving president of Petrobras under Bolsonaro, Castello Branco was appointed during the transition period by the future Minister of Economy Paulo Guedes, with whom he formed a group ironically named “Chicago Oldies”, because they studied at the University of Chicago.

Defender of the privatization of the state-owned company, Castello Branco deepened the strategy started in the Michel Temer government, which provided for a focus on the pre-salt layer, sale of assets in areas considered non-strategic and better remuneration to the shareholder.

During his management, Petrobras changed its dividend policy, allowing payment even in the event of a loss, in a process that justified the record readjustments paid in 2022.

He began his term with controversial measures that pleased Bolsonaro, such as the appointment of a former candidate supported by the President of the Republic to manage the state-owned company and a retreat in the readjustment of the price of diesel.

But he entered the former boss’s sights on the way out of the most turbulent period of the pandemic, at the end of 2020, when the recovery in international oil prices made fuel prices soar in the country.

Bolsonaro criticized Castello Branco for his high salary, for working from home during the pandemic and, finally, announced his resignation in one of his Thursday lives, causing the company to lose BRL 32 billion in market value the next day .

Before leaving, the executive presented the 2020 balance sheet, the year in which the company had a profit of R$ 7.1 billion, defending the company’s pricing policy. “Surprising, in the 21st century, we are paying so much attention to this,” he said.

Joaquim Silva and Luna (Apr.21 to Apr.22)

The second president of Petrobras under Bolsonaro was also the second longest-serving. General Joaquim Silva e Luna presided over Itaipu Binacional when he was invited to replace Castello Branco, at a time of expansion of the military presence in the energy sector.

His nomination encouraged the president’s supporters, who expected a shift in the company’s management. As soon as he took office, however, Silva e Luna stroked a financial market that feared changes in the fuel price strategy, saying they reconciled the interests of consumers and shareholders.

Silva e Luna maintained the pace of the asset sale program and, although it reduced the frequency of fuel price adjustments, it was responsible for the mega-increases of March 2021, in response to the spike in international prices after the start of the War in Ukraine.

Dismissed after the readjustments, he defended that Petrobras “is inspected by more than two dozen inspection and control bodies and has robust governance in compliance and sustainability”. He also said that “there is no room for adventurers in the state-owned company”.

He was also targeted by Bolsonaro for the high salary of the state-owned company. “The director earns R$ 110,000 a month. The president more than R$ 200,000 a month and, at the end of the year, still has some bonus salaries. The guys have to work!”, said the president.

Fired while Bolsonaro was already negotiating a successor, Silva e Luna left the company saying he was betrayed by the President of the Republic.

José Mauro Coelho (Apr.22 to Jun.22)

Former secretary of the MME (Ministry of Mines and Energy) under Bolsonaro, José Mauro Coelho was not the first bet to replace Silva and Luna, but ended up taking the position after the withdrawal of consultant Adriano Pires, questioned for providing services to clients and state competitors.

Once again, a president appointed by Bolsonaro took office defending the policy of parity of fuel prices in relation to international quotations, although the President of the Republic has spent a good part of his term criticizing the rise in prices.

“We have to have prices in the domestic market related to import parity prices. If that weren’t the case, we wouldn’t have any economic agent with aptitude, or willing to bring derivatives to the country. And we would have a risk of shortages”, he stated, still in 2021.

The risk of shortages was one of the main arguments of his mandate to continue readjusting prices. Petrobras even sent an alert to the MME about the possibility of a diesel shortage at the end of the year if prices remained out of date.

His departure from the state-owned company was also troubled: his resignation and the name of his replacement were announced by Bolsonaro at the end of May, but Coelho resisted resigning, which delayed the process of transferring command of the company.

Caio Paes de Andrade (Aug.22 to present)

A name that faced greater internal resistance at the state-owned company, Caio Paes de Andrade occupied a secretary at the Ministry of Economy when he was appointed by Bolsonaro to “give new dynamics” to fuel prices in the country.

His appointment was questioned by Organs internal control bodies, given his lack of experience in the oil sector or in companies of the same size, requirements demanded by the State-owned Law, but Bolsonaro also elected a more aligned board of directors, which approved his name.

His management was the one that most acted in favor of the government. Helped by the fall in international oil prices, Petrobras began to announce a series of reductions in fuel prices in the midst of the electoral process.

In addition to the greater frequency of cuts, the company also started to announce changes in prices of products that were not previously the target of public announcements, such as aviation kerosene and asphalt. So almost every week there was positive news for the president’s campaign.

The same frequency was not seen when international prices rose again after the first round vote, leading Petrobras to spend weeks with prices lagged in relation to the import parity.

Paes de Andrade also accommodated in the state-owned company people close to the Planalto Palace and the Army, such as Colonel Luiz Oávio Franco Duarte, who served under the command of General Eduardo Pazuello in the Ministry of Health, and reserve soldier Mario Pedroza da Silveira Pinheiro.