Petrobras pricing policy unchanged, minister says

By Jake Spring and Lisandra Paraguassu BRASILIA (Reuters) - Petroleo Brasileiro SA's market-based diesel pricing policy remains unchanged, Brazil's mines and energy minister told reporters on Tuesday, despite a cancelled price hike on Friday that spooked investors. President Jair Bolsonaro's call last week to the chief executive of Petrobras, as the firm is known, led the company to call off a sharp diesel price increase and revived investor fears about political influence on the company, hammering its share price. The episode underscored the leverage of truckers in Brazil, which relies overwhelmingly on road freight to get agricultural exports to port and keep its economy humming

Reuters April 17, 2019 04:05:56 IST
Petrobras pricing policy unchanged, minister says

Petrobras pricing policy unchanged minister says

By Jake Spring and Lisandra Paraguassu

BRASILIA (Reuters) - Petroleo Brasileiro SA's market-based diesel pricing policy remains unchanged, Brazil's mines and energy minister told reporters on Tuesday, despite a cancelled price hike on Friday that spooked investors.

President Jair Bolsonaro's call last week to the chief executive of Petrobras, as the firm is known, led the company to call off a sharp diesel price increase and revived investor fears about political influence on the company, hammering its share price.

The episode underscored the leverage of truckers in Brazil, which relies overwhelmingly on road freight to get agricultural exports to port and keep its economy humming.

Speaking at an event in the capital city, Minister Bento Albuquerque characterized the cancellation of the price hike at the behest of Bolsonaro as a "communication error." Bolsonaro did not appear to be well-informed of what was happening, he said.

Bolsonaro's office said it would have no comment on Albuquerque's remarks.

On Friday, the president's spokesman said that in principle Bolsonaro believed there should be no political interference at Petrobras, but he wanted a meeting on the matter given the possible effects of the price change.

A trucker strike over high diesel prices last year paralysed Brazil's economy for weeks, led to the departure of the then-CEO at Petrobras and handicapped an already unpopular government.

Bolsonaro, who took power in January, was one of the most prominent politicians to throw his weight behind truckers' complaints last year and has been sensitive to their demands.

At a news conference earlier on Tuesday, presidential Chief of Staff Onyx Lorenzoni and Infrastructure Minister Tarcisio Freitas pledged 500 million reais ($129 million) of loans from a state bank for independent truckers on Tuesday and announced other measures designed to avoid a threatened strike, but remained silent on their underlying complaint about fuel prices.

Preferred shares of Petrobras closed up 2.8 percent in afternoon trade, though those gains occurred before the minister's comments.

($1 = 3.89 reais)

(Reporting by Ricardo Brito; Writing and additional reporting by Gram Slattery; Editing by Dan Grebler)

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