Gasoline price drops another R$ 0.20 per liter at the pumps, says ANP – 05/26/2023 – Market

The price of gasoline at Brazilian stations fell another 3.6%, or R$ 0.20 per liter, this week, with new transfers from the cut in Petrobras refineries. According to the ANP (National Agency of Petroleum, Gas and Biofuels), the fuel was sold, on average, at R$ 5.26 per liter.

The value is even higher than projected by Petrobras when it announced the cuts and the change in its fuel price policy, on the last 16th. The accumulated drop since then is 4.2%, or R$ 0.23 per liter.

At the time, the sale value of the product by the state-owned company was reduced by R$ 0.40 per liter. The company’s expectation was that the transfer would lead the sale price at the pumps to R$ 5.20. The government set up a task force and opened a channel for complaints to try to force the fall.

The movement is criticized by distributors and service stations, who claim that there is no price regulation in Brazil and that competition will bring values ​​to the right price. In a note distributed this week, the service stations also point out that other factors influence prices, such as biofuels and logistical costs.

The ANP found the cheapest gasoline in Brazil in Goiatuba (GO), at R$ 4.14 per liter. The most expensive one was found in Tefé (AM), at R$7.

Also as a result of cuts in refineries, the average price of S-10 diesel at Brazilian service stations fell 4%, or R$0.22 per liter this week, to R$5.24 per liter. It is the lowest value since September 2021, in inflation-corrected values.

Since the 16th, the accumulated drop in the price of diesel S-10 is 5.9%, or R$ 0.33 per liter. In this case, the transfer has already exceeded Petrobras’ forecast. The state-owned company expected that common diesel would reach R$ 5.18 per liter. It reached R$5.17 this week.

Diesel returned to cost less than gasoline for the first time since June 2022, when the federal tax cut on the latter had made it cheaper. Due to its importance for the transport of cargo and passengers, diesel historically has a lower tax burden in the country.

Accompanying the drop in gasoline at the pumps, the price of hydrous ethanol fell 3.7%, or R$0.15 per liter this week, to R$3.84 per liter. Product sales depend on a more competitive price, since its engine performance is lower.

Cooking gas, which was also reduced at refineries, was sold, on average, at R$ 105.84 per 13-kilogram cylinder. It is a decrease of 2.6%, or R$ 2.88 per cylinder, compared to the previous week.

The price cuts were celebrated by the government and have been used as an argument to pressure the Central Bank to reduce interest rates, one of the main targets of President Luiz Inácio Lula da Silva (PT) at the beginning of his term.

Item with greater weight in the composition of the IPCA, gasoline, however, will be pressured again in early June, with the effectiveness of the new ICMS collection model, which has an average rate of R$ 0.20 per liter higher than the current one, according to accounts by consultant Dietmar Schupp.

In July, the federal government should fully resume the PIS/Cofins rates, which had been zeroed by former President Jair Bolsonaro (PL) and partially resumed by Lula in March.

Finance Minister Fernando Haddad went so far as to say that Petrobras had withheld part of the cut to compensate for the tax increase, but he backtracked after the state company refused.

Currently, the space is small: according to Abicom (Brazilian Association of Fuel Importers), gasoline sold at Petrobras refineries is R$ 0.29 per liter below import parity, a concept that was abandoned by the company but continues as a market benchmark.