Petrobras started 2024 with challenges on the horizon after dealing with many challenges in 2023. With the election of President Luiz Inácio Lula da Silva (Workers’ Party), the state-owned company gained new directors and advisors. With them, the company reduced fuel prices and announced the expansion of investments, which decreased during the governments of Michel Temer (MDB Party) and Jair Bolsonaro (Liberal Party).
Researchers and workers in the petroleum sector said to Brasil de Fato that these were positive changes that strengthened the company’s strategic role in the national economy. However, they believe the measures adopted in 2023 must be deepened in 2024 for the good of the company and the national population, Petrobras’s majority shareholder via the state.
In May last year, Petrobras changed its pricing policy. The so-called Import Parity Price (IPP) was abandoned as a reference to determine fuel prices. The company decided to compete again against private agents for sales, a measure reflected in gas stations across the country.
According to the Institute for Strategic Studies of Petroleum, Natural Gas and Biofuels (Ineep, in Portuguese), the average diesel price fell 7% in Brazil between November 2022 and November 2023 due to the measures Petrobras adopted. It contributed to keeping general inflation under control. In 2023 – and for the first time since 2020 – inflation is expected to end the year within the goal established by the National Monetary Council.
Economist Eric Gil Dantas, from the Petroleum Social Observatory (OSP, in Portuguese), said abandoning IPP was undoubtedly a positive measure. However, he also says that Petrobras had even sold oil at higher prices than abroad last year and affirms that it has to change.
“The beginning of Petrobras' pricing policy was very good. It guaranteed prices were actually lower than those of imports or private competition. But, as of November, this has changed completely. The company even charged a higher price for fuel than the Acelen and 3R [private refineries]," he said. "This goes against its own pricing policy, which promises better prices than other companies," Dantas explained.
Mahatma dos Santos, one of Ineep’s directors, confirmed that, in November, Petrobras had prices above IPP both for gas and diesel.
On December 26, the state-owned company announced a 7.9% decrease in the diesel price. Gasoline, however, did not fall between October and December.
Dividends
Petrobras also changed its shareholder remuneration policy in 2023. The company, which was the one that distributed the most profits in dividends during 2022, decided to retain part of its earnings in cash to invest.
The change was also approved by experts, since the lack of investments could harm the company's future in the long-term. They highlighted, however, that the change is still shy and should be strengthened to benefit the company.
In 2022, Petrobras paid dividends of about 104% of its net profit, that is, its shareholders received more resources than the company effectively generated. In 2023, this percentage will decrease to 80%. To Dantas, it is still too much and should be reduced.
“The balance between dividends and investments has improved, but there are still changes to happen,” said Deydiv Bacelar, general coordinator of the Petroleum Workers Union (FUP, in Portuguese). “We are in a process and the official discourse says there is no chance of changing everything just in one year,” he added.
“Given the dismantling and de-nationalization that happened in Petrobras throughout recent years, the company must advance fast in expanding its investment capacity towards the needy promotion of a fair energy transition,” Santos said.
Investments
Regarding investments, Petrobras announced a strategic plan for 2024-2028 that provides for US$102 billion in investments. The amount is 31% higher than the resources in the 2023-2027 strategic plan.
The plan includes investments in an energy transition project, mainly to generate electricity using wind. Therefore, Petrobras shows intentions of leaving petroleum behind and becoming an energy company in a broad sense, a change seen as fundamental within the context of global warming.
Bacelar, from FUP, said the plan addresses part of the demands of petroleum investors about Petrobras. He thinks that works at refineries will be resumed, something that must be done to increase fuel production and reduce the country’s dependence on oil-derived imports.
Dos Santos, from Ineep, mentioned that the investments announced are insufficient. “Petrobras remains immersed in a dispute between a shortsighted, short-term business plan defended by its minority shareholders and, on the other side, the need to build a long-term strategic plan focused on the operational and financial future of the company to get closer again to a sovereign national development project.”
In a message to employees, the president of Petrobras, Jean Paul Prates, stated that, in 2023, the company resumed looking at Brazil’s future and development. “We did a lot of things," he said. “In 2024, we will do even more.”
“We have challenges ahead. We will carry out all of our projects,” he added. “We have new exploration frontiers and an energy transition process to build,” he said.
Edited by: Rebeca Cavalcante
