Politicians often say that the version is more important than the facts. In an attempt to change the narrative about fuels, an economically sensitive and electorally explosive agenda, Jair Bolsonaro wore a hypothetical gas station uniform. To please drivers and truck drivers – one of the pillars of his electoral base – he changed the command of Petrobras. After a few weeks of relatively discreet frying (by presidential standards), retired general Joaquim Silva e Luna left, to be replaced by economist Adriano Pires, a decision announced on Monday (28).
So far, just facts. However, as of Pires’ inauguration, scheduled for April 13, the conflict of narratives will gain intensity. The president-nominee is a deep connoisseur of the energy sector. He founded the consultancy Centro Brasileiro de InfraEstrutura (CBIE), coordinating projects and studies for the natural gas industry, national fuel policy, the market for oil products and natural gas. And he has been critical of price controls.
Every week, the CBIE publishes its oil price lag estimate. And on Monday night (28), he published on his social networks that he considered the risk of intervention in Petrobras prices “low” before the elections. Cite two reasons. He considered that the state-owned company’s compliance had improved after Lava Jato. And he assessed that if Bolsonaro intervened in prices, he would be accused of repeating the strategy of Lula and Dilma Rousseff.
“Does Petrobras have social responsibility? Have. Can it be used as public policy? Do not. Like partisan politics? Never!” General Silva e Luna current president of Petrobras.
Everything looks right. However, on Wednesday (30) Petrobras followed a mandatory protocol that puts in check the expectations of continuity of the current policy. With shares on Wall Street, the state-owned company reports to the Securities and Exchange Commission (SEC), the American equivalent of the Securities and Exchange Commission (CVM). In a 20-F form, sent to the SEC, the state-owned company informs that the government can change the company’s pricing policy by decision of “a new board or a new Board of Directors”. On the same day, the CVM opened an administrative proceeding to find out why the news of the replacement had been released by the Ministry of Mines and Energy without the mandatory manifestation of the state-owned company.
It is a fact that a similar declaration was submitted to the SEC last year, when Roberto Castello Branco gave way to Silva e Luna. And the CVM also opened a similar inquiry. And, just like a year ago, the behavior of the state-owned company’s new commander remains unclear. In his speech, Pires is critical of interference in prices and even defends the privatization of Petrobras. Thus, while he signals the maintenance of the price policy to please the market, the exchange indicates – at least in the narrative – that Bolsonaro will not leave the motorized middle class and truck drivers unattended.
PRESSURE The president had been under pressure for weeks by the Centrão to find a solution to the electorally toxic high fuel prices. However, parliamentarians found in Silva e Luna an executive for them irritatingly committed to the governance of the state-owned company. And the general contradicted the captain, who had asked for more time before the fuel readjustment, announced on March 10. That’s when the Bolsonarista base in the Chamber moved. One of the deputies, who spoke to the report, said that Pires was the idea of the PL articulators and that the president “thought a lot, talked a lot and made the best decision for Brazil”. Speaking on condition of anonymity, he said the decision “has displeased the military wing, but it will be very well received by the people.”
“The risks of intervention in Petrobras’ prices, in this period before the elections, are low” Adriano Pires future President of Petrobras.
Silva and Luna decided to go out shooting. “Does Petrobras have social responsibility? Have. Can you make public policy? Do not. Can you do party politics? Even less,” he said during a lecture at the Superior Military Court (STM). On a tour of Europe to talk to investors, Economy Minister Paulo Guedes said that the problem was someone else’s. “I think we should privatize Petrobras, but I don’t have votes, I’m just an economy minister,” he said. Guedes must have forgotten that Pires advocates creating a buffer fund for oil price fluctuations. In moments of low prices, part of the profit of the state-owned company is reserved to subsidize consumers in moments of high. Pires cannot implement something like this without Guedes’ participation. It will be up to the economic team to design how this transfer of dividends will take place. If made by the National Treasury, it will be another crack in the cracked Ceiling of Spending. If it is an expense outside the Ceiling, it will require a solution that does not disrespect the Fiscal Responsibility Law. In addition to the Ministry of Economy, the discussion will involve the National Congress.
If the market seems to welcome change, it is the lack of it that has frustrated truck drivers. Wallace Landim, president of the Brazilian Association of Motor Vehicle Drivers (Abrava) is not optimistic about the exchange, and fears that the strategy is just a trial balloon. “What Bolsonaro is doing is buying time.” According to the truck driver, the category is without strength, and the government has not fulfilled its promises to protect the driver. At the end of the day (or minister-generals), more important than the chosen version of the story, is realizing if those who will hear the message still believe in you.
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