Page 4 - LatAmOil Week 46 2022

LatAmOil COMMENTARY LatAmOil

(Photo: Twitter/@LulaOficial)
Lula may make change for

Petrobras a high priority

The Brazilian president-elect has signalled that he may start working soon to revamp the NOC’s

mission and function so that it can concentrate more on renewables and less on fossil fuels

Brazil’s President-elect Luiz Inacio Lula da between the government and the state-owned
Silva has already made it clear that his approach company over domestic fuel prices. Rather, he
WHAT: to the oil and gas industry will be rather differ- has indicated that he wants to bring the NOC to
Brazil’s president-elect ent from that of Jair Bolsonaro, the incumbent work more closely with the government so that
has hinted at a desire for president who is due to leave office in January. it views domestic policy goals as higher priori-
change at Petrobras by He has stated, for example, that he does not ties than profits.
selecting COP27 as his favour Bolsonaro’s efforts to privatise assets such Bolsonaro has been pushing Petrobras to
first international trip.
as oil refineries that have been categorised as shield consumers from inflation by keeping
WHY: extraneous to the national oil company (NOC) domestic fuel prices artificially low, but the
Lula’s view of the NOC’s Petrobras’ core operations. Instead, one of his NOC has shrugged off this pressure, pointing
function has always campaign aides has talked about renationalising to provisions in the Brazilian constitution that
diverged sharply from the oil-processing plants that have been sold off preserve its independence on this front.
that of Bolsonaro. or at least making arrangements to ensure gov- Lula has similar concerns about rising prices
ernment representation on the boards of priva- and their impact on consumers, but for ideolog-
WHAT NEXT: tised refineries. ical reasons, he would rather see the government
Significant policy chang- Lula has also responded negatively to the take greater control of the company (and of the
es would affect Petro- incumbent’s suggestions that Petrobras itself sector at large) than adopt a market-oriented
bras’ performance. be sold off in order to put an end to wrangling solution.

P4 www. NEWSBASE .com Week 46 16•November•2022