President of the association of importers, Sergio Araújo says that lack of transparency causes insecurity
The new fuel pricing strategy of the Petrobras he has “very vague variables”, said the president of the abicom (Brazilian Association of Fuel Importers), Sergio Araújo, in an interview with Power360. The state-owned company ended the PPI (Import Parity Price) this Tuesday (May 16, 2023), after 6 years.
According to Petrobras, the price practiced by its competitors and the opportunity cost of the state-owned company are part of the new formula for calculating the value of fuels in the domestic market. The president of Petrobras, Jean Paul Prates (PT), also said that the strategy must consider oil prices and the exchange rate.
“With these vague variables, Petrobras will be able to change its prices at will in a non-transparent way, without harming its governance, since it is changing its pricing policy”, declared Araújo.
The president of Abicom claims that the variables of Petrobras’ new pricing policy are not known. “Nobody, for example, knows the production cost of a refinery, nobody knows the marginal value per refinery. This lack of transparency creates insecurity”, he stated.
“I NEED TO WAIT”
However, Araújo stated that it is necessary to wait to see how Petrobras will implement the strategy. He mentions the cut of 12.6% in gasoline and 12.8% in diesel, announced this Tuesday morning (16.May). According to the president of Abicom, the reductions were already expected by the market, since Petrobras’ prices were above the PPI.
Adopted in October 2016, the PPI equated the prices charged by Petrobras in the domestic market to the value of imported fuels. The parity policy favored the import segment in Brazil, which gained competitiveness.
“Having a dominant agent, as is the case with Petrobras, with all this ease of adjusting its prices without transparency generates insecurity and can push some agents away from this import activity, as happened more or less 20 years ago. In 2002 and 2003, Petrobras practiced artificially low prices and the companies that operated in imports left the market”, said Araújo.
Today, national production supplies most of the demand, but Brazil depends on imports to guarantee the supply of gasoline, diesel and LPG (liquefied petroleum gas). The dependence is 12.6% for gasoline, 18.5% for LPG and 25.5% for diesel, according to data from the ANP (National Agency for Petroleum, Natural Gas and Biofuels).
#Petrobras #pricing #policy #vague #Abicom