Amid attacks by the Jair Bolsonaro government and allies against Petrobras, Senate President Rodrigo Pacheco (PSD-MG) said this Friday (17) that there is no “dichotomy” between the government and the state-owned company, as the União is the largest shareholder. Pacheco also said that if the government wants to contain fuel inflation, it should use Petrobras’ profits to create a price-stabilizing fund.
Pacheco did not adopt the tone of Bolsonaro and allies, who preferred to blame the soaring prices at Petrobras. Earlier this Friday, the state-owned company announced a readjustment in gasoline and diesel, following the fluctuations of the international market.
The president of the Senate, through a note released to the press, sought to make it clear that the government is responsible for Petrobras.
“If the fuel price situation is getting out of control, the government must accept to share Petrobras’ huge profits with the population, through a price stabilization account in times of crisis,” said Pacheco.
“After all, the Petrobras and government dichotomy does not exist, as the Union is the majority shareholder of the state-owned company and its board is appointed by the government”, added the president of the Senate.
Bolsonaro has been experiencing a crisis with Petrobras in recent months. He changed the president of the state-owned company twice this year alone, in an attempt to make the company change its pricing policy. Petrobras claims that, by law, it must apply changes in the prices of oil and oil products on the foreign market to the domestic market. Otherwise, the company claims that it may be sued in court or even cause fuel shortages in Brazil (importers would not want to bring the product to a country with lagged prices).
Bolsonaro fears that rising prices will damage his image with the electorate and his reelection plans. This Friday, he called the new Petrobras adjustment “betrayal” and suggested a CPI to investigate the state company.
Close allies departed for similar attitudes. The president of the Chamber, Arthur Lira (PP-AL), said that the board of Petrobras has “bad faith” and practices acts “against the Brazilian people”. He also said that he will call a meeting on Monday (20) to seek alternatives to change Petrobras’ pricing policy.
The Minister of the Civil House, Ciro Nogueira, protested on social media.
“Enough is enough! The time has come. Petrobras does not belong to its directors. It belongs to Brazil. And it cannot, therefore, continue with such insensitivity, ignore its social role and abandon Brazilians in the biggest crisis of the last century”, wrote the minister. .
The alternative of creating a fund with the profit of Petrobras to stabilize prices has also been sought by states of the federation.
In 2021, Petrobras recorded a record net income of R$106.6 billion, the highest ever recorded by publicly traded companies in Brazil. In the first quarter of this year, with the rise in oil, the state-owned company’s profit totaled R$ 44.5 billion.
The equalization fund is based on a project, already approved by the Federal Senate, but which has not yet passed the scrutiny of the Chamber of Deputies. Therefore, it is still not valid.
The Ministry of Economy says it is against the fund. The Secretary of the National Treasury, Paulo Valle, for example, argues that the creation would be an “expensive and inefficient” measure.
According to a survey by Bolívar Moura Rocha and Fernando Hamú Alves, from Levy & Salomão Advogados, some countries have already used this mechanism, including: Peru, Chile, Malawi, Morocco, Nigeria, Thailand and Vietnam. The data were obtained from the World Bank.
The bill approved by the Senate defines that, if the fund is created, there will be a floor and a ceiling for fuel prices. It also establishes that, if the higher price is exceeded, producers and importers will be compensated for any losses.
The resources to form the fund, according to the project, will come from:
- Union shares resulting from the concession and sale of surplus oil in the production sharing regime;
- excess of collection, in relation to the annual forecast, of the Petrobras dividends;
- revenue from the oil sector;
- financial surplus of the federal government (balance resulting from revenues minus expenses).
According to the Federal Revenue, the collection of fuels totaled R$ 30.71 billion in the first four months of this year. The “royalties” and special participations of the Union on oil totaled R$ 13.09 billion from January to April.
Petrobras, in turn, announced that it will pay BRL 32 billion in dividends to the Union by July, for last year and the first quarter of 2022. The sum of all these resources is another BRL 75 billion in this year’s partial. However, not all amounts would be transferred to the stabilization fund.
See the full note released by Pacheco:
“If the fuel price situation is getting out of hand, the Government must accept to share Petrobras’ huge profits with the population, through a price stabilization account in times of crisis. After all, the Petrobras and Government dichotomy does not exist , as the Federal Government is the majority shareholder of the state-owned company and its board is appointed by the Government.In addition, similar measures are being adopted by other countries in favor of their economy and their population.
The Senate approved numerous legislative matters that were within its reach and now expects quick and effective measures from Petrobras and its parent company, the Union. Since the government is against discussing the company’s pricing policy and interfering in its governance, the stabilization account is an alternative to be considered.”