Why does the ICMS cut reduce gasoline, but DIESEL remains high?

In recent weeks, there has been a noticeable reduction in gasoline prices It’s from ethanol at bombs across the country. The main agent of this fall is the cut in the Tax on the Circulation of Goods and Services (ICMS). The state tax rate is known to be levied on several products, including fuels.

Read more: Gasoline price may return to what it was in June 2021; check the value

Due to the lower ICMS, currently between 17% and 18%, the average price of gasoline went from R$7.39 to R$5.74 (a drop of 22.3%). In the case of ethanol, the fuel derived from sugarcane fell from R$5.34 to R$4.21 (a 23.8% drop).

However, the diesel, which had a more affordable price, seems to have been left out of the account and is still over priced at many gas stations. But why is this happening? Find out below!

Why has gasoline dropped in price, but diesel remains high?

The main reason for the diesel price still being high may be associated with the conflict between Russia and Ukraine in Eastern Europe. About 25% of the diesel oil imported by Brazil originates in the country under the command of Vladimir Putin.

In Russian territory, part of the product has been withheld for use in combat, more precisely to supply vehicles.

According to Petrobras, the forecast is that in the coming months there will be new highs in the price of diesel. But the increase will not only be attributed to the war, but also to the arrival of winter in Europe: the drop in temperatures increases demand for use in generators and other equipment, further reducing the supply of the product.

Another point that can put the fuel supply in the country on alert in the coming months is the arrival of the harvest period by the states. In this sense, there is a need for flow, which is largely done by trucks via the road system.

About Yadunandan Singh

Born in 1992, Yadunandan approaches the world of video games thanks to two sacred monsters like Diablo and above all Sonic, strictly in the Sega Saturn version. Ranging between consoles and PCs, he is particularly fond of platform titles and RPGs, not disdaining all other genres and moving in the constant search for the perfect balance between narration and interactivity.

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