Brazil: Petrobras readjusts aviation kerosene prices by 11.4%

RIO DE JANEIRO, BRAZIL – On June 2, Petrobras announced it had readjusted the sale price of aviation fuel by 11.4%.

Petrobras said the fuel prices sought a balance with the international market and followed the variations in the product’s value and the exchange rate. According to Petrobras, the monthly adjustment has been adopted for approximately 20 years.

According to Abear (Brazilian Association of Airlines), aviation kerosene has registered an increase of 64.3% in the year to date.

The association said that fuel is the factor that impacts airlines the most since it accounts for more than 1/3 of total costs. Airline tickets have already gone up 89% in the 12-month accumulated until May.

READ THE FULL NOTE FROM PETROBRAS

“Petrobras clarifies that the aviation kerosene (QAV) sale prices to the distributors are adjusted monthly and defined by a contractual formula negotiated by the companies.

“This practice has been adopted for approximately 20 years since the first commercial contract between Petrobras and the distributors.

“Petrobras’ QAV sale prices seek to balance them with the international market and follow the product’s value and exchange rate variations, upwards and downwards.

“As a result of applying the contractual formula, an average readjustment of 11.4% was implemented on June 1.

“Petrobras markets the QAV produced at its refineries or imported only to distributor companies.

“These, in turn, transport and market the product to airlines and other end consumers at airports or to resellers.

“Distributors and retailers are responsible for the facilities at the airports and the fueling services.

“The Brazilian fuel market is open to free competition, and there are no legal, regulatory, or logistical restrictions for other companies to act as producers or importers of QAV.

“For Petrobras’ sale prices to the distributors, access the new fuel price website.”

With information from Poder360

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