Petrobras increases gasoline prices for the first time in 11 months

SAO PAULO (Reuters) – Brazilian state-owned oil company Petrobras will increase gasoline prices for distributors for the first time in almost a year this week, the company said on Monday, at the same time it will raise prices for liquefied gas from petroleum (LPG).

The oil giant’s announcement that it would increase gasoline prices by around 7% from Tuesday sent its shares up as much as 1.9% in São Paulo trading, with investors welcoming the somewhat unexpected move. .

It represents Petrobras’ first gasoline price adjustment since Magda Chambriard replaced Jean Paul Prates as chief executive in May, and the first time the company has increased gasoline prices since a 16.3% increase in August 2023 in amid higher global oil prices.

In 2023, Petrobras abandoned a more market-based pricing policy in favor of one that gave it more flexibility to smooth out price fluctuations.

The company’s last change in gasoline prices was in October 2023, when it reduced them by 4%, on average.

With the changes, the company said in a statement, gasoline will rise by 0.20 reais (US$0.0366) per liter, to an average of 3.01 reais/liter. Average LPG prices, in turn, will be increased by 3.10 reais, to 34.70 reais for a 13 kg cylinder.

Andrea Angelo, strategist at brokerage Warren Investimentos, said the measures could have a combined impact of an increase of 18 basis points on inflation in 2024, with the increase in the price of gasoline representing 13 basis points.

Angelo now expects Brazil’s benchmark consumer price index, IPCA, to rise 4.28% this year, up from the 4.10% she estimated before the changes announced by Petrobras.

($1 = 5.4639 reais)

(Reporting by Marta Nogueira and Luana Maria Benedito; editing by Gabriel Araujo and Tomasz Janowski)