Lula keeps Prates, which is in the test phase – 04/12/2024 – Market

The president of Petrobras, Jean Paul Prates, will remain in office, after two weeks of turbulence.

The entry of the Minister of Finance, Fernando Haddad, into the debate changed the scenario, in a defeat to the ministers of the Civil House, Rui Costa, and of Mines and Energy, Alexandre Silveira, who were against Prates remaining in the role.

Interlocutors of President Lula (PT) claim that he even announced to allies that he would fire Prates, which meant that the change in command of the state-owned company was considered certain until last Sunday (7).

Prates’s permanence in office, however, is conditional on changes in conduct, according to allies of the Chief Executive.

According to government members who participated in discussions on the topic, the head of the economic team defended the distribution of extraordinary dividends, a position that had been taken by Prates and was one of the reasons for the crisis between him and Silveira. Haddad’s defense comes from the fact that part of the dividends will go to the Union’s treasury and will alleviate the federal government’s financial situation.

Lula was moved by the Finance Minister’s arguments, according to ministers, because he was convinced of the need to reduce the deficit in public accounts.

Another point that weighed in favor of keeping Prates, at least temporarily, was the absence of a natural successor for the position.

Also according to members of the government, the name of the president of BNDES, Aloizio Mercadante, lost strength after he himself told the current head of Petrobras that he had been approached for the role.

This initiative by Mercadante would have bothered the president, who began to evaluate other names for the company’s presidency. In the absence of a natural successor, Prates is gaining momentum to try to regain Lula’s trust.

According to government ministers, Prates should be more in tune with Lula’s expectations regarding the company’s social role, not limited to the interests of shareholders.

The president’s allies even recommended that he not fire Prates in the heat of frying, especially after the Minister of Mines and Energy, Alexandre Silveira, publicly criticized the president of Petrobras in an interview with Sheet.

Since Sunday, Lula has consulted allies. The Minister of Finance was one of those who interceded in favor of Prates’ stay, on the grounds that there was no technical motivation for his dismissal.

The president of the Senate, Rodrigo Pacheco (PSD-MG), also defended his maintenance in the position, endorsed by a group of senators.

Another factor that favors Prates is the formal process for appointing the president, which requires up to three months. The name of the nominee must be submitted to the company’s board, whose composition must be changed at a shareholders’ meeting on April 25.

The new board formation should give a signal of what the president expects from the company’s management.