MercoPress. South Atlantic News Agency
Petrobras hikes gasoline and diesel prices to help with the company's finances
The price hikes, 6% and 4%, are the first since increases of 3% for gasoline and 5% for diesel imposed in November 2014. Brazil's state-controlled Petrobras unexpectedly increased wholesale gasoline and diesel prices in the domestic market, potentially widening a controversial premium to international prices. The heavily indebted company said that the gasoline price would increase by 6%, and diesel by 4%, as of this Wednesday.
The price hikes are the first since increases of 3% for gasoline and 5% for diesel imposed in November 2014.
Between 2010 and 2014, Petrobras was forced by the federal government to sell fuel at below international prices, resulting in an estimated R80bn ($19.9bn) in losses for the company.
The price controls were intended to curb inflation, which is now hovering at more than 9.5% for the past 12 months.
But the sharp decline in oil prices since mid-2014 has introduced a reverse distortion. For much of this year, Petrobras has been selling diesel on the domestic market at above international prices.
Although the margins on gasoline have fluctuated over this period, as of last week, Petrobras was already selling gasoline at an estimated 12% premium to the price abroad.
Critics have long called on the government to institute a predictable fuel pricing model that reflects global market trends.
The new price increases are certain to spark a backlash from consumer and industrial groups. A main beneficiary of the gasoline price increase is Brazil´s struggling ethanol industry.
With the higher price, mills will be able to raise the price of hydrous ethanol, which competes directly with gasoline at the pump. Petrobras also raised LPG and natural gas prices in the domestic market earlier this month.
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Read all commentsEmails Link Brazilian Ex-President Lula to Petrobras Scandal
Oct 01st, 2015 - 05:44 pm 0http://panampost.com/sabrina-martin/2015/10/01/emails-link-brazilian-ex-president-lula-to-petrobras-scandal/
DumbAss Dilma fucked Mr. Market by keeping the price of fuels artificially low but he has had his revenge and hasn't stopped yet!
Oct 01st, 2015 - 05:51 pm 0It always happens thus. The Brazil Nuts don't know who or what the market is though, that much is crystal clear. If only the public would realise it is how THEY act that creates Mr. Market things would really take off.
Too many illiterates in the population are letting this bunch of crooks off easy.
“Link[s] Brazilian Ex-President Lula to Petrobras Scandal”
Oct 02nd, 2015 - 12:04 am 0I have been saying this for a while now. I always knew he was dirty.
Tik Toc!
Best that I buy some more yarn, looks like I have some knitting to do, they are already building the guillotine....
(cackles...)
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