The recent rise in global oil prices, paired with depreciation in emerging market currencies has driven Petrobras to increase the price of diesel and gasoline in refineries in Brazil, the firm announced on Monday.
Average diesel prices in refineries will increase 9.5%, while gasoline prices in refineries are expected to rise 8.1%. The price hike was reported by Petrobras on Monday 5th Dec, and is said to be effective as of Tuesday 6th Dec.
While the Brazilian Real gained back 1.5% of its buying power against the US dollar DoD on Monday, it is still pegged over 5% weaker MoM, pushing the price of imported fuel higher in Brazil. Additionally, the global energy complex has continued its rally following OPEC’s agreement to cut production last week, driving Brent crude oil prices above $55/bbl for the first time since mid-2015 on Monday.
According to Petrobras, the price increase in refineries should lead to a final consumer price increase of roughly 5.5% for diesel and 3.4% for gasoline. This should add support to both anhydrous and hydrous ethanol prices across Brazil, pushing dollar denominated prices on a FOB Santos basis for exports higher for the new crop season. According to PRIMA data, Brazilian B-grade ethanol for the new crop is currently pegged at 540USD/m3.