Brazil is considering a request by Petroleo Brasileiro SA (PETR4), the country’s state-owned oil company, to increase the amount of ethanol added to gasoline, said two government officials with knowledge of the discussions.
Authorities are reviewing ethanol supplies in the South American country to determine if there is enough to proceed with the measure, which would help reduce imports and boost Petrobras’s earnings, said the officials, who asked not to be identified as the matter is not public.
Brazil lowered ethanol levels in gasoline in August because low stocks were pushing up fuel prices, which is no longer the case, said Adriano Pires, head of the Brazilian Center for Infrastructure.
“The impact on gas prices would be zero,” Pires said by telephone from Rio de Janeiro. “The most important thing is that this would reduce Petrobras’s gasoline imports.”
Petrobras incurred losses of about 750 million reais ($361 million) from fuel imports this year, Pires said. Increased ethanol levels could cut gas imports by 40 percent, he said.
The state-owned company hasn’t asked for an increase, Miriam Guaraciaba, a Petrobras spokeswoman, said by telephone from Rio de Janeiro. Spokesmen at the energy ministry and the finance ministry weren’t immediately available to comment.
To contact the reporters on this story: Mario Sergio Lima in Brasilia Newsroom at email@example.com; Carla Simoes in Brasilia Newsroom at firstname.lastname@example.org
To contact the editor responsible for this story: James Attwood at email@example.com