Brazil’s securities regulator to probe Petrobras after Bolsonaro’s statement on fuel prices
RIO DE JANEIRO, BRAZIL – Brazil’s Securities and Exchange Commission (CVM) on Monday, December 6, opened an administrative proceeding involving Petrobras after President Jair Bolsonaro on Sunday announced that the state-owned company would lower fuel prices until the end of December.
Case number 19957.010061/2021-47 concerns the supervision of news, relevant facts, and press releases, and was opened by the agency’s Company Monitoring Management 1 (GEA-1), which is expected to examine recent facts involving the company.
“Petrobras will begin this week announcing a reduction in fuel prices,” Bolsonaro said on Sunday. According to the report, the President did not provide details about the rate of reduction, but stated that the drop should continue for some weeks.
Petrobras on Monday said in a statement that it never anticipates decisions on price readjustments. “Petrobras reiterates its commitment to the practice of competitive prices and in balance with the market, while preventing the immediate pass-through of external volatility and exchange rate caused by circumstantial events,” the state-owned company said.
Petrobras said it continuously monitors the markets, including a daily analysis of the behavior of its prices relative to international quotations, among other procedures. “Petrobras does not anticipate readjustment decisions and stresses that no decision has been taken by its Market and Price Executive Group (GEMP) that has not yet been announced to the market,” it said.
STATE-OWNED COMPANY CRITICIZED BY BOLSONARO
Under pressure from mayors and legislators, Bolsonaro has criticized the rise in fuel prices and blamed governors for the ICMS, a tax collected by the states. The President has also mentioned Petrobras’ pricing policy, which follows international oil prices, and said that the company “is a nuisance.”
Last week, Economy Minister Paulo Guedes once again debated the advantages of keeping Petrobras as a state-owned company, albeit listed on the stock exchange. He has often said that he would like to privatize the company once and for all.
“Does a state-owned company listed on the stock exchange help society, bring down prices and eventually bankruptcies, as in the past government? Or does it become a market company, raising prices and squeezing consumers, as is now happening with oil? Petrobras doesn’t satisfy anyone, and the bomb is placed in the government’s lap,” Guedes said.
Oil prices closed sharply higher on Monday, helped by more positive assessments regarding the Omicron variant of the coronavirus, which, according to initial studies by health authorities, has not caused severe effects of the disease after infection.
On the New York Mercantile Exchange (Nymex), a barrel of WTI oil for January was up 4.87%, quoted at US$69.49, while Brent crude for the following month rose 4.58% on the Intercontinental Exchange (ICE), in London, reaching US$73.08.
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