Bolsonaro Halts Gas Price Increase, and Petrobras Loses US$8,3 Billion in Market Value

Pressure to limit increase in price of gas overruled market demand for liberal economy

Brasília, Macapá and Washington

President Jair Bolsonaro (PSL) admitted on Thursday to ordering Petrobras to suspend the 5.7% increase in diesel oil at refineries. The state-owned company at first denied the government interference in the reverse, which happened without consulting the economic team.

"I'm not an economist, I've already said that I did not understand economics," Bolsonaro said. He said he was worried about the truckers, who had threatened to strike again.

Shares fell 7.8%, the highest change since June 1, 2018. (Foto: Bruno Rocha/Fotoarena/Folhapress) ORG XMIT: 1713117 - Fotoarena/Folhapress

The measure caused Petrobras to lose R $ 32.4 billion (US$ 8,3 billion) in market value. Shares fell 7.8%, the highest change since June 1, 2018. The president confirmed the intervention on his social network, but he denied being an interventionist.

The government minimized the measure. The vice president, Hamilton Mourão, called it punctual and stated that the interference that  occurred under President Dilma Rousseff (PT)  will not be repeated. Minister Onyx Lorenzoni (Civil House) asked for time to “deal with the monopoly" of Petrobras.

Translated by Kiratiana Freelon

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