The next president of Petrobras, Jean Paul Prates (PT-RN), defends a new pricing policy by Petrobras and is one of the major critics of the current model practiced by the oil company, the PPI (Import Parity Price). On several occasions, Prates spoke of changing the state-owned company’s pricing policy and, for exceptional moments, the creation of a stabilization fund to contain fuel fluctuations.
“The PPI, even today, already varies by region [para região]. When we talk about extinguishing the PPI, stop using the PPI as a reference, it’s not that we are going to completely tear the price away from the international market. The country is not crazy. We are not going to create a parallel economy in Brazil”, said this Friday (30.Dec.2022), shortly after the announcement of the president-elect, Luiz Inacio Lula da Silva (PT).
Jean Paul said that not having the PPI as a reference is “stop targeting the price of the refinery door, with the price of the product that is produced in completely random and distant places in the world, plus shipping and expenses”.
The senator was also rapporteur at the Casa Alta do bill which creates a fuel price stabilization fund.
According to the text approved at Casa Alta, but which stopped at the Chamber, domestic prices charged by fuel producers and importers must be based on the average prices on the international market.
However, according to Prates’ text, the government will be able to use mobile price bands to establish limits for fuel price changes.
The idea is that there is a stabilization fund that would be activated when the price of a barrel of oil has a large fluctuation and, with that, impact on the formation of fuels.
The extra difference between the reference price used and the upper limit of the band is offset in favor of producers and importers of oil derivatives. One of the sources of funding for this stabilization fund would be through Petrobras dividends paid to the Union.
For this, according to Prates, the ANP (National Agency of Petroleum, Natural Gas and Biofuels) should create a reference price, considering the proportion of each fuel that is produced in Brazil.
The idea is for the regulatory agency to carry out a reference price analysis every regular period of time, taking into account everything that is necessary for the final formation of the price that is charged to the final consumer.
According to Prates, today, as Petrobras is hegemonic in price formation, the value that the state-owned company determines is what the market will practice and, with the import parity, makes the scenario even more unpredictable, since the price formation is subject to unpredictable events such as the war in Ukraine.
New dividend policy
The change in Petrobras’ dividend distribution policy under Prates’ management is taken for granted. The senator has criticized several times the distribution of almost all of the oil company’s profits to its shareholders. This, by the way, was one of the great resistances of the market in relation to the name of the senator for the presidency of the state-owned company. Petrobras shares closed down 1.21% on the day the senator was announced as the number 1 company.
In the last distribution, the oil company paid BRL 43.6 billion to shareholders, which will end up being paid on January 19, 2023. The amount is equivalent to 94.5% of the company’s net profit in the period. The expectation is that with Jean Paul Prates the company will again make new investments that were not foreseen today.
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