Brazilian President Luiz Inacio Lula da Silva’s government on Tuesday fired the chairman and chief executive of state-owned oil giant Petrobras, Jean-Paul Pratsis, over a dispute between the two sides over the distribution of dividends.

“Pracis has been dismissed,” a spokesman for the presidency summarized to AFP.

For its part, Petrobras announced in a statement that Mr. Pratsis, 55, requested an emergency meeting of the company’s board of directors to consider “the early end of his term” following “negotiations” and submitted his resignation. .

On April 25, Petrobras shareholders approved the distribution of an extraordinary dividend of 4 billion euros for the 2023 fiscal year, during which the group recorded the second highest net profit in its history, as well as saving another 22 billion reais in a special fund, intended to guarantee the payment of dividends in the future.

Initially the company’s board of directors, which is controlled by the Brazilian state, had decided not to pay any dividends. The announcement, on March 7, sent Petrobras’s share price tumbling on the stock market and was described by analysts as a consequence of government meddling in the company’s affairs, something market players say has worried them since the government took power. Lula (center left) in 2023.

The head of state has repeatedly accused the leadership of Petrobras that it only thinks about how to satisfy its shareholders, at the expense of consumers.

A little more than half of the company’s capital belongs to the Brazilian state and the rest to private individuals.

Mr Pratsis, once a senator from the Workers’ Party (PT), Lula’s faction, was named head of Petrobras in January 2023, shortly after Lula returned to the presidency. The two reportedly had a close relationship.

The group experienced several upheavals during the four years of the presidency of far-right Jair Bolsonaro (2019-2022). Four presidents succeeded each other on the Board of Directors of Petrobraz, mainly due to disagreements over its pricing policy.

In the 68 years of its existence, the presidency of the giant public enterprise has been characterized… waltz: it has been ruled by 39 presidents, with an average length of stay in the position of less than two years.

Lula also canceled the further privatization process that had begun under Bolsonaro.

It has not yet been officially announced who will replace Mr Pratsis, but the presidency’s spokesman told AFP the government was preparing to nominate Magda Sambriad, the former head of the National Petroleum Agency, Brazil’s sector watchdog.