Petrobras announces the third diesel price cut in Brazil within 46 days

Petrobras announced on Monday (Sept. 19) a 5.8% reduction in diesel price for distributors.

The liter will drop from R$5.19 to R$4.89 at state-owned refineries starting Tuesday (Sept. 20).

This is the third reduction in fuel prices in 46 days.

In a statement, the state-owned company said the reduction follows the evolution of reference prices and is in line with Petrobras’ pricing practice, which aims to “adjust its costs to the market, but without transferring the volatility of quotations and the exchange rate to domestic prices.

According to Petrobras, the share of biodiesel in the consumer price will increase from an average of R$4.67 to R$4.40 per liter, considering the mandatory blending of 10% biodiesel to diesel sold at gas stations.

Since Caio Mario Paes de Andrade took over as president, Petrobras has reduced fuel prices at its refineries faster.

The state-owned company announced price cuts for diesel on Aug. 4 and Aug. 11.

This was four times in the case of gasoline: the first cut on Jul. 19, the second on Jul. 28, the third on Aug. 15, and the fourth on Sept. 1.

Paes de Andrade is the fourth president of Petrobras under the government of Jair Bolsonaro (PL).

The other three fell due to wear and tear from the rise in fuel prices.

In 2016, Petrobras began making adjustments at its refineries due to fluctuations in the international market.

Prices are based on the barrel price and the exchange rate.

Since oil prices will increase from 2021 and the real will lose value against the dollar, fuel prices at refineries will increase.

Now the scenario is in favor of the government.

The barrel of Brent oil is falling, closing last Thursday (Sept. 15) at US$90.84 – the lowest since February.

According to the Brazilian Association of Fuel Importers (Abicom), the price of diesel in the domestic market is R$0.47 higher than the import value on Monday (Sept. 19).

On the other hand, gasoline is R$0.17 below the price paid for the imported product.

With information from Poder360