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Petrobras Completes 17 Days Without Readjusting the Petrol Price

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Petrobras will maintain the price of gas at its refineries on Thursday, completing 17 days without readjustmentsaccording to oil data.

The current average price of fossil fuel sold by the state-owned oil company to the distributors is 2.0450 reais per liter – a higher value since October 23, 2018, according to data previously published by the state oil company.

The average value has not changed since April 30, despite a rule launched in September last year by the previous management, which prevented the stability of the fuel for a period of more than 15 days.

Asked if the 15-day rule was canceled, Petrobras said that the gasoline price policy remains unchanged and is based on the import parity price.

“The term of up to 15 days of maintenance of gasoline prices refers to the maximum period of application of the hedging mechanism. This mechanism, of optional application, aims to give additional flexibility to the management of the policy of gasoline prices,” said the oil company in a statement.

In April of this year, already in the management of Roberto Castello Branco, the company arrived to complete 18 days with the gasoline at the same level.

The average price of diesel in the refineries was also maintained on Thursdaycomplying with Petrobras’ current rule for this fuel, which prevents adjustments in periods of less than 15 days. The diesel is frozen at 2.3047 reais a liter since May 4.

Petrobras has stated that it practices market prices, although it has increased the periods without readjustments. To avoid losses, the oil company has pointed to the use of hedge mechanisms.

But, faced with the lack of readjustments, the president of the Brazilian Association of Fuel Importers (Abicom), Sergio Araujo, reiterated to Reuters on Wednesday that its associates are struggling to compete with Petrobras.

“Specifically for gasoline, a product for which Petrobras has not been practicing fixed periodicity, the expectation of the announcement (of a new adjustment) is great to verify if variations of the domestic price will follow the correlation of the international market, which would give more security for the resumption of operations,” Abicom said in a bulletin on Wednesday.

According to the association, as the price of the international market suffered falls in the last days, there was the possibility of a reduction announcement in Petrobras prices on Wednesday, in the order of 0.06 real per liter, but that was not achieved.

In addition to pricing, the association pointed out that the demand scenario is also critical, since the first quarter of this year had volume 9.4 percent lower than the same period last year, while ethanol, more competitive, is on the rise.