The Minister of Mines and Energy, Bento Albuquerque, denied yesterday the possibility of the government interfering in Petrobras’ pricing policy. Asked if the government intends to promote some kind of change in company policy, the minister replied: “None.”
According to Albuquerque, there was a “miscommunication” in the episode involving the disclosure and subsequent suspension of the diesel price readjustment by Petrobras last week.
“There was a communication error in the presentation of this index of 5.7%. By contingencies, I was flying to Roraima and when I landed I started to receive the information. I understand that the president, not being informed and not having the people to inform him exactly what was happening, he asked for clarification and that is what we are going to give him too soon, “said the minister referring to the meeting with the president of the Republic, Jair Bolsonaro, this afternoon.
The minister’s statement came during an event to discuss the oil and gas sector and shortly before leaving for the meeting with the president to discuss the company’s pricing policy. At the end of the event, the minister said that what happened was a “communication problem” that is neither pointing nor insinuating guilty.
Last Thursday, Petrobras announced a 5.7% increase in the average price of diesel. Subsequently, the president said that he had contacted Petrobras to suspend the increase. The suspension would have occurred to avoid a possible truck stoppage. After suspending the increase of the fuel, Petrobras said that there was margin “to space a few days the readjustment in the diesel”.
The next day (12), Petrobras lost R $ 32 billion in market value, the company also denied that there was interference. Bolsonaro Administration said that it will not interfere with the company.
According to Petrobras, even with the delay, it will continue with the fuel readjustment policy aligned with the International Parity Price (PPI). Under this policy, diesel prices at the company’s refineries (corresponding to around 54% of final consumer prices) will be adjusted for periods of not less than 15 days.
Guedes defends the end of the monopoly
Economy Minister Paulo Guedes said on Tuesday that Petrobras was independent to set prices and that President Jair Bolsonaro made it clear that it would be out of the question to manipulate state oil prices.
The statement was made after a meeting of just over an hour with Bolsonaro, the Minister of Mines and Energy, Bento Albuquerque, the president of the state, Roberto Castello Branco, technicians of the area, and Guedes himself.
The Economy Minister said it was clear that this was a “clarification” meeting.
“The President of the Republic has a greater concern than just the market. It’s natural that I’m always worried about market issues, I’m worried about anything that might seem like intervention, but I have to admit that he’s president of 200 million people, “said Guedes.
“He really, rightfully told me ‘explain this business to me.'”
Guedes also said that the president “seems” to have been satisfied with the explanations presented to him about the company’s pricing policy.
“He understands that there are price practices and that it is out of the question to do price manipulation,” he said.
Guedes acknowledged that the interpretation that there could be interference is “legitimate” and that the government does not want to get that impression.
“The loss of Petrobras’ stock is the smallest loss. If you begin to manipulate price, all concession process, refinery flow, all this is affected, “he said.
Petrobras’ move to cancel the planned uprising has raised concerns from experts, who warned of risks over the company’s current president plans to sell a significant portion of the refineries.
The minister also said that the state-owned company is studying “best practices” for its pricing policy and needs to increase transparency.
Guedes said, however, that it will be up to the company to decide on the next increase, which will replace the barred by the president.
“It’s going to have to be recalculated,” he said.
Petrobras has decided to keep diesel and gasoline prices stable at its refineries on Wednesday, according to state news reports earlier Tuesday.
Petrobras diesel has not been readjusted since March 22. Gasoline was last readjusted on April 5, when the price rose 5.6 percent.
Guedes returned to the speech that a “cheap energy shock” is needed in the country, with privatizations and changes of regulations to allow other actors to enter the oil market in the country.
“We’re going to start off with a shock of more competition and get this problem out of the way. This problem is only in the lap of government because the government has a monopoly. What interests us is to change long-term market conditions, we want to go towards the private sector and competitive markets, “he said.
The minister said that the government itself has been studying alternatives and that if there were a very high increase in fuel prices, it could, for example, reduce taxes. “That has a price, will cut from where, from health to give the trucker?” He asked.
The economics minister stressed, however, that the economic dimension of these iinterference has to be considered even in order not to disrupt the future oil auctions. “We have $ 1 trillion to get out of the pre-salt if you manipulate price, every process is affected,” he added. “We do not want to be a government that manipulates pricing policy, as in the past.”
After the meeting, Guedes said he did not know if Petrobrás would keep the 5.7% increase that would be given last week. He said the state-owned company could make smaller readjustments at shorter intervals or raise the price at once.
According to Albuquerque, the value of diesel practiced at the country’s gas stations is 12% lower than the international average.