MercoPress. South Atlantic News Agency

Bolsonaro lashes out at Petrobras for new fuel price increase

The president wants a parliamentarian committee to review Petrobras leadership's decisions

Brazilian President Jair Bolsonaro Friday said the state-run oil company Petrobras' profits were “irrational” in the current global scenario following a 14% increase in the price of diesel fuel and 5% in naphtha.

”It is inconceivable to grant (price) readjustments when fuels are up there and with the exorbitant profit of Petrobras,” said Bolsonaro, who is very much aware that every increase causes anger among voters ahead of the Oct. 2 elections where he trails Former President Luiz Inàcio Lula Da Silva, according to every poll.

Petrobras' shares fell nearly 8% on the São Paulo Stock Exchange and Bolsonarists are already calling for the resignation of Chairman José Mauro Coelho, who took office last April.

Effective Saturday, diesel will go from R$ 4.91 to R$5.61 (approximately US$1.1) per liter and gasoline from R$ 3.86 to R$ 4.06 (US$0.80) per liter after the price of diesel went up 24.9% in March and 8.8% in May. The oil company argued Friday's decision was necessary because “the global market is in a challenging situation” stemming from the war in Ukraine.

Bolsonaro believes Friday's adjustment was a “betrayal” after the emergency meeting Petrobras' Board held Thursday and insisted on creating a Parliamentary Committee of Inquiry (CPI) for which he is said to already have the endorsement of Lower House Speaker Arthur Lira.

”I spoke with Lira a few minutes ago, he is currently with the leaders (of legislative blocks) and our idea is to propose a CPI to investigate the president (of Petrobras, Coelho), the directors, and the (members) of the Administrative Councils. We want to know if there is something wrong in their conduct,“ Bolsonaro underlined.

Lira said Coelho needed to resign ”because he does not represent the will of the majority shareholders of Petrobras, which is Brazil and is systematically working against the Brazilian people in the worst crisis of the country.”

Coelho was dismissed by Bolsonaro in May, but his departure from the company has not yet become effective because the formalization will only take place after a meeting of the Board and the Assembly, meetings that have not been convened so far. Coelho took office in April this year after the president dismissed the previous head, General Joaquim Silva e Luna, also over disagreements with the pricing policy.

The fuel increase is a sensitive issue for Bolsonaro, with Lula between 15 and 20 percentage points ahead in all surveys.