Bolsonaro suggests Petrobras government revenue could push fuel prices down

September 30 (Reuters) – Brazilian President Jair Bolsonaro said on Thursday that profits from state-owned oil company Petrobras (PETR4.SA) could be used to dampen the country’s fuel price hike, among the possibilities of dealing with higher prices.

Fuel prices have become a hot topic in Brazil as inflation soars. The recent CEOs of Petrobras have been forced to step down due to the price hike. Petrobras shareholders remain wary of price controls, leading the government to seek other programs to reduce costs for consumers.

Bolsonaro said a fund could be created using government revenues from Petroleo Brasileiro SA, as the company is officially known. The money could be used to potentially not pass the cost of rising fuel prices on to consumers.

“Seeing the profits from Petrobras, the ones that go to the federal government … this billion dollar profit – I ask, I don’t confirm it – can’t we convert it and put it in a regulatory fund ? Bolsonaro said on a weekly live online broadcast.

Brazil’s lower house president Arthur Lira said on Wednesday that Congress was considering such a “stabilization fund”. The fund could cushion fluctuations in fuel prices, while allowing Petrobras to maintain its market-based pricing policy, he said.

Bolsonaro reiterated previous statements that Congress should approve a bill that would set the ICMS fuel taxes that currently vary between states, another move aimed at lowering prices at the pump.

Reporting by Maria Carolina Marcello; written by Jake Spring; Editing by Leslie Adler

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