Brazilian president criticises Petrobras for being too profitable

Brazilian President Jair Bolsonaro said state-controlled Petroleo Brasileiro SA (Petrobras) is too profitable.

“It should be a company that makes a profit that isn’t so high as it has been lately,” Bolsonaro said. “It’s a state company that, with all due respect, only gives me a headache. We’re going to break the monopoly.” Further, he said, work is being done to change Petrobras’ policy of tracking international fuel prices.

A few hours later, the company posted a third-quarter profit of $5.3bn.

Bolsonaro leads many other Brazilian politicians, including opposition critics, according to BNN Bloomberg, who “appear to want the firm to lower prices or at least refrain from further hikes, a move that would seriously hurt the company’s bottom line but please voters heading into an election year.”

CEO Joaquim Silva e Luna, a former army general appointed by Bolsonaro in April this year, responded to Bolsonaro’s criticism of the company’s too-high profit and of its high fuel prices, saying, “Petrobras doesn’t pursue profit for profit. Our goal is to generate value for shareholders and society through taxes, dividends and job growth.”

Petrobras’ head of sales and marketing, Claudio Mastella, said the company will continue with its policy of tracking international prices.

Bolsonaro was recorded on October 30 talking with Turkish President Recep Tayyip Erdogan at the G-20 conference in Rome. “Petrobras is a problem,” Bolsonaro said. “But we are breaking monopolies, with a very big reaction.”

Meanwhile, Gustavo Montezano, CEO of BNDES, Brazil’s government development bank, said last week, “We as a society and the political class are realizing there is no direct economic benefit of having a state-owned oil producer. It just generates political noise since we’re blamed when oil goes up.” However, he added, the government has not notified BNDES to start the process to sell off the state-controlled asset.

Kim Biggar

Kim Biggar started writing in the supply chain sector in 2000, when she joined the Canadian Association of Supply Chain & Logistics Management. In 2004/2005, she was project manager for the Government of Canada-funded Canadian Logistics Skills Committee, which led to her 13-year role as communications manager of the Canadian Supply Chain Sector Council. A longtime freelance writer, Kim has contributed to publications including The Forwarder, 3PL Americas, The Shipper Advocate and Supply Chain Canada.
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