Petrobras postponed a bigger fuel cut waiting for higher taxes, says Haddad – 05/17/2023 – Market

Finance Minister Fernando Haddad (PT) revealed that Petrobras did not lower fuel prices as much as it could to “save fat” for when the reduction in the price of gasoline and diesel ended during the government of Jair Bolsonaro (PL).

“The increase planned for July 1 will be absorbed by the price drop that was left for that day. We did not lower everything we could, just waiting for July 1. As will happen with diesel at the end of the year”, said the minister in an audience in the Chamber of Deputies this Wednesday (17).

President Luiz Inácio Lula da Silva (PT) staggered the tax reencumbrance on fuels in March this year through an MP (Provisional Measure). The full rate will return to effect at the beginning of the second half for gasoline and at the end of the year for diesel.

To avoid a rise in the prices of oil derivatives —and, consequently, a negative impact on inflation—, Petrobras, as the Minister of Finance said, saved downward adjustments to the prices of its products for when taxes rise.

This drop in price announced by the state-owned company was possible thanks to the drop in the dollar and oil prices, pointed out the minister. He criticized the way in which this was done by Bolsonaro last year, which included, in addition to federal exemptions, a reduction in the ICMS charged by the states on products.

“In Petrobras’ price change, as the dollar fell, oil fell, you manage to accommodate this without inflationary pressure, helping to combat inflation without disorganizing the finances of governors”, he pondered.

Petrobras announced this Tuesday (16) the end of the international price parity policy. In the sequence, it reduced the price of gasoline in the refineries of the state-owned company by 12.6%, or R$ 0.40 per liter. The price of diesel was reduced by 12.8%, or R$ 0.44 per liter. Already the price of kitchen gas fell 21.3%, or R$ 8.97 per cylinder of 13 kilos.

Haddad spoke for nearly five hours in the Chamber. In response to questions from parliamentarians, he defended Lula’s management, attacked Bolsonaro and said he saw room for reducing interest rates.

He also defended the fiscal framework project, saying that the country’s economic growth will not come from boosting government spending, but from debt stabilization and inflation reduction.

Haddad’s expectation is that the urgency of the project will be approved today and the text itself next week.