Haddad suggests “rehearsed move” between government and Petrobras

The Minister of Finance, Fernando Haddad, suggested that there is a “rehearsed move” between the government and Petrobras, in which the state company reduces prices to mitigate the impact of tax increases. Such a move would be scheduled for July, repeating what happened in March.

On Wednesday (17), Haddad said that the new readjustment of PIS and Cofins on fuels, scheduled for early July, will be offset by a price drop at Petrobras refineries. According to him, the company could have made the entire reduction already this week, but would have opted for a smoother cut. Thus, said the minister, it maintained a “fat” that will be used later on.

“Increase [da tributação] scheduled for July 1st will be absorbed by a drop in the price, which was left for that day”, said the minister in an audience at the Chamber of Deputies. Then, he used the first person to comment on Petrobras’ decision: ” We didn’t download everything we could [no preço]just waiting for the 1st of July, when the export tax and the re-encumbrance cycle ends, just as it will happen with diesel at the end of the year, and it already left a fat to accommodate the re-encumbrance”.

The statement signaled a submission by the state-owned company to the interests of the government of Luiz Inácio Lula da Silva (PT), just one day after the company changed its commercial strategy and abandoned the “mandatory” parity with the international market. On Tuesday (16), Lula himself said that the decision to “Brazilianize” prices fulfilled a campaign promise, even though the president of the state-owned company, Jean Paul Prates, said that there was “absolutely no intervention” by the government in the state-owned.

Haddad’s speech rekindled investors’ fear of using Petrobras for political ends and led to a drop in shares. Preferred shares, the most traded, fell 2.43%. The company was forced to send a statement to the market hours later, stating that “it does not anticipate readjustment decisions” and that “there is no decision taken by its Executive Market and Prices Group (GEMP) that has not yet been announced to the market “.

Although it is controlled by the Union, Petrobras is a mixed economy company, with private partners, listed on stock exchanges and supervised by bodies such as the Securities and Exchange Commission (CVM). The company has to follow its own bylaws and the State-owned Law, which impose respect for market conditions and prohibit price manipulations.

The next day, Haddad tried to downplay what he said to the deputies, stating that “Petrobras is the one who makes Petrobras’ price policy.” According to him, the comparison with the international market indicated that the space to reduce the local price “was greater than announced”.

However, an estimate by Abicom, the association of importers, indicates that Brazilian gasoline now costs 4% less than that sold in the Gulf of Mexico. According to another calculation, by the Brazilian Infrastructure Center (CBIE), fuel in Brazil is now 15% below international parameters.

In March, Petrobras lowered prices on the same day the government raised taxes

Although Haddad relativized what he said in the Chamber, months ago he made similar statements. He stated that a “mattress” made it possible to lower or raise fuel prices, and that it could be used as a “contribution” by Petrobras.

And, in fact, on March 1, the company lowered prices on the same day that the government began to reestablish PIS and Cofins rates on fuel. The sum of the two federal taxes rose from zero to R$0.47 per liter, while a liter of gasoline at refineries dropped by R$0.13.

The Finance Minister’s plan is to reinstate the “full rate” of PIS/Cofins in July, which would lead to an increase of R$0.22 per liter in gasoline. It is not known what will happen with the taxation of ethanol, since months ago the government informed that it would give privileged treatment to the sugarcane derivative.

Until the middle of last year, the two federal taxes amounted to R$ 0.69 per liter of gasoline and R$ 0.24 for ethanol. They were reset by December, as determined by then-president Jair Bolsonaro (PL). On his first day in office, Luiz Inácio Lula da Silva (PT) extended the benefit until February and, in March, began the reencumbrance.