While Brazil's Energy Minister Adolfo Sachsida appeared Tuesday before the Lower House to answer questions about the current situation regarding the state-owned oil company Petrobras, the Government of President Jair Bolsonaro is concocting other strategies to curb the neverending increases in the price of fuel.
The Minister of Mines and Energy argued that the Government of President Jair Bolsonaro is not in a position to interfere in the prices of fuels set by the company. It is necessary to be clear, it is not possible to interfere in the price of diesel and gasoline. We have a legal framework that prevents government intervention, even if the government is a majority shareholder.
Sachsida made those remarks during a hearing to promote the creation of a Parliamentary Commission of Inquiry against the members of Petrobras' Board of Directors, a move Bolsonaro has called for and on which he has already agreed with Lower House Speaker Arthur Lira to bring to an end the constant adjustment of the price of fuel at pumps.
These increases are ordered to meet international prices, but Bolsonaro finds it outrageous that the company seeks to keep its profits unchanged in a world crisis scenario and believes Petrobras should give up some of its outrageous dividends in favor of the people of Brazil. Bolsonaro claims that not doing so is tantamount to treason.
The current crisis led to Monday's resignation of Petrobras CEO José Ferreira Coelho, after which shares fell by 8 %, while Tuesday they went 1.03% further down, and the preferred shares fell by 2.43 % on the São Paulo Stock Exchange.
The State-Owned Companies Law passed under former President Michel Temer (2016-2018) bars any administration's capabilities to interfere in pricing policies or any other corporate decision from a politically-motivated standpoint. The price of fuel at pumps is a sensitive issue during an election year in which Bolsonaro trails opposition candidate and former head of state Luiz Inácio
Lula Da Silva in all polls.
Sachsida insisted the structural solution to Petrobras' problems would be to privatize it in order for the market to regulate prices based on greater competition, but he acknowledged that this option may be valid in the medium term and not to provide an urgent response to the current crisis.
Petrobras is a state-owned open capital company, with shares offered on the New York and Sao Paulo stock exchanges, with a Board of Directors featuring a majority of members appointed by
the government. But even if proposed by the government, Petrobras' CEO must have a background in energy issues.
Bolsonaro and his ministers have received reports from lawmakers recommending a change in the State-Owned Companies Law, considered the most direct way to contain prices less than four months before the elections.
Last week, Bolsonaro said the country was on the verge of chaos if the hike continued, which was finally confirmed on Friday with the announcement of a 14.26% increase in diesel and 5.18% in gasoline.
Congressman Ricardo Barros has announced he would be filing a bill consisting of a Provisional Measure to allow the Government to set prices in line with the interests of the current administration, a move to which Lira is said to have agreed since it would have an immediate effect, although it would need to be ratified at a later stage by Congress.
The state-owned companies became autonomous beings with their own life, many times dissociated from the government of the moment, Lira said Monday.
In the meantime, the government continues to collect signatures to create a CPI on the oil company's directors. By Tuesday afternoon, 79 of the 171 signatures required for the creation of the body had been obtained.