"Petrobras Said to Skip Fuel Price Discussion at Board Meeting"
Petroleo Brasileiro SA (PETR4), Brazil’s state-controlled producer, didn’t discuss a fuel price increase that investors had been anticipating at a board meeting today, said a person with knowledge of the board meeting.
Petrobras rose 6.7 percent to 15.28 reais today in Sao Paulo on speculation the company would increase the prices for diesel and gasoline. The recent plunge in the price of crude has brought international benchmarks more into line with its subsidized refinery gate prices. Petrobras will meet again on Nov. 4 and it is unclear if fuel prices will be discussed, the person said.
Petrobras, which is controlled by the government through a majority of voting shares, normally announces fuel price increases after board meetings, even though it can adjust prices without board approval. The Rio de Janeiro-based producer hasn’t adjusted gasoline and diesel prices since last November.
President Dilma Rousseff’s administration has used Petrobras as an inflation-fighting tool, and the most indebted publicly-traded oil company has booked more than $44 billion in operating losses at its refining unit from selling fuel at below-market prices.
Petrobras’s debt has more than doubled to $139 billion during Rousseff’s first term because revenues were insufficient to finance more than $40 billion a year in investments. Moody’s Investors Service cited the lack of a market-based fuel price policy as one of the reasons it downgraded the company’s debt on Oct. 21.
To contact the reporter on this story: Sabrina Valle in Rio de Janeiro at
svalle@bloomberg.net
To contact the editors responsible for this story: James Attwood at
jattwood3@bloomberg.net Peter Millard
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