A cut of R$ 0.19 per liter, roughly R$ 9.50 on a 50-liter tank: that is what stands after Petrobras, Brazil's state-controlled oil company, withdrew a gasoline price increase on Thursday (Sept. 10). If the reduction is passed on in full, drivers pay less every time they fill up, and pump prices may fall by 2%, according to estimates obtained by the newspaper O Globo. The move comes less than a month before the first round of Brazil's general election.
On Wednesday night (Sept. 9), at 8:44 p.m., the company had announced a R$ 0.19 per liter increase at its refineries, following its practice of using federal subsidies to soften the oil price surge that came after the United States and Israel attacked Iran, the newspaper reported. At 12:53 a.m. on Thursday, it distributed a correction saying there would be no increase after all. The average price of gasoline A (pure gasoline, before the mandatory ethanol blend that creates what is sold at stations) now stands at R$ 3.05 per liter to distributors, a level that still picks up state taxes and margins before reaching the pump.
Why the price fell
The mechanics: since May, gasoline carried a R$ 0.44 per liter discount paid by the federal government to Petrobras, a mechanism known as an economic subsidy and created by Provisional Measure 1.358/2026, a presidential act with the force of law. That measure expired and the discount ended. The government's new package cut PIS and Cofins, federal taxes embedded in fuel prices, by R$ 0.63 per liter, and because the tax cut is larger than the discontinued discount, the net result is a reduction of R$ 0.19 per liter.
The overnight correction gives no reason for the reversal and says only the following:
"Contrary to what was previously informed, the change in the price of Petrobras gasoline at points of sale will correspond only to the suspension of the discount"
Asked whether it had consulted its board or government representatives, the company said pricing decisions "are taken exclusively within the Executive Group for Markets and Prices (Gemp)", a body formed by directors. One explanation heard by O Globo is a misunderstanding: the decree on the tax break "was complex to understand", according to a source who asked not to be named. Government officials, in turn, concluded that the company miscalculated, since the whole subsidy operation had been coordinated to shield consumers.
The election at the center of the debate
Reports from the investment banks Itaú BBA and BTG Pactual said the reversal raised doubts about the independence of the company's pricing policy. "Without a shadow of a doubt", the decision was driven by the election, said Vitor Sousa, an analyst at Genial Investimentos, noting that the gap between international prices and those charged by Petrobras is wide. He compares the moment with 2010 to 2014, when the government of Dilma Rousseff used the company to hold down inflation and it "became a tool of monetary policy".
In the stock market, the surge of oil to US$ 107.63 a barrel spoke louder: Petrobras preferred shares (non-voting) closed up 1.45% at R$ 49.12, and common shares (voting) rose 1.77% to R$ 54.64. About 80% of the company's results come from exploration and production, so pricier barrels lift revenue.
Diesel remains under pressure: imports cover 25% to 30% of demand, the fuel has accumulated a 13% increase since the war in Iran began, and there is no political room for a refinery increase before the election, in the assessment of Sérgio Araujo, president of Abicom, a group that represents fuel importers. According to O Globo, the cost of fuel subsidies has already reached R$ 37.5 billion, and estimates cited by the newspaper suggest the package can shave 0.15 percentage point off the IPCA, Brazil's official inflation index.