Petrobras Shrinks in Fuel Market

02/17/2017 - 11h00

With higher prices in the international market during a major part of the year, Petrobras lost participation in the fuel supply to the Brazilian market last year.

The losses occurred in imported goods as well as in retail - in the latter segment, sales are made through its subsidiary, BR Distribuidora.

Petrobras, which was responsible for 83.7% of gasoline imports in 2015, saw its participation decline to 59.7%, according data of the ANP, Brazil's Petroleum Regulatory Agency.

In the case of diesel, the participation fell from 84.2% to 16.4%. The ANP believes that the decline occurred because Petrobras maintained its prices above international prices during most of last year. That opened "windows of opportunity" for other companies to attack the company's market.

The ANP estimates that Petrobras's diesel price was on average 35% above international prices up until November.

In October, in the face of the market loss, Petrobras decided to modify its price policy and began to follow prices overseas more closely, with monthly assessments of the market conditions.

In 2016, imports represented 12% of the Brazilian diesel market and 8% of the gasoline market. The ANP also says that 41 new companies filed requests to import fuel last year. Private importers include distributors such as Ipiranga and Raízen (which operates Shell), as well as companies specialized in fuel trade.

In the retail segment, Petrobras also registered losses in market participation in its three main products.

The company said that it "considers the presence of other agents participating in the supply to the Brazilian demand positive" and that its goal is to maximize results and generate income. BR Distribuidora said that its business plan calls for an increase in market share, with actions such as network expansion and marketing campaigns. The sales of fuel declined by 4.5% in the country in 2016.

Translated by THOMAS MUELLO

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