Brazilian elections won’t affect Petrobras prices, CEO promises

The Petrobras logo can be seen outside the company’s headquarters in Sao Paulo on April 23, 2015. REUTERS / Paulo Whitaker / File Photo

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RIO DE JANEIRO, Dec. 30 (Reuters) – Brazil’s 2022 general election will not influence Petrobras’ fuel pricing policy, the state-owned oil company’s chief executive told Reuters on Thursday.

Petroleo Brasileiro SA (PETR4.SA), as the company is officially known, officially fixes the prices of domestic fuels according to international prices, although it allows a brief decoupling when world prices fluctuate due to temporary rather than structural factors. in the opinion of the company. .

The policy has been the subject of significant criticism from politicians and the public this year, amid a dramatic increase in fuel prices. Analysts and investors are worried that the government of Jair Bolsonaro, which is running for re-election but lags badly behind in the polls, is trying to cut prices, which would appeal to voters but hit the bottom lines. business results.

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Petrobras CEO Joaquim Silva e Luna, who has always championed the current pricing policy, said there would be no changes in 2022.

“The pricing policy is not going to keep pace with the elections, our pricing policy is pretty well consolidated,” he told Reuters.

“Company pricing decisions are technical, top to bottom. They have to be so that the company does not lose credibility.”

Luna said he expects the company in 2022 to focus on sustaining its debt level, potentially paying additional dividends, continuing its asset sale program and investing heavily in a prolific formation of offshore oil production called pre-salt.

The company is also excited about the prospects for Brazil’s Equatorial Margin, an area off the country’s north coast considered a promising exploration area, but which has proven to be complex from an environmental and regulatory perspective. .

“We’re going to focus even more on the pre-salt,” Luna said, adding that the equatorial margin could be the company’s “new pre-salt”.

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Reporting by Rodrigo Viga Gaier; written by Gram Slattery; edited by Richard Pullin

Our Standards: Thomson Reuters Trust Principles.

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