Brazil’s House Speaker Arthur Lira raised the potential of privatizing oil and gas major Petrobras this morning, saying that the company is prioritizing action plans for the distribution of dividends, which in his view is not consistent with the company’s status as a majority state-owned firm.
“There is a policy that has to be revised, because it is neither public nor private, completely. It only distributes and chooses the best ways to use resources to distribute dividends,” Mr. Lira told Rádio CNN. “This is the question that has to be asked: wouldn’t it be the case to privatize Petrobras? Wouldn’t it be time to discuss what Petrobras’s role in Brazil is?”
For Mr. Lira, the argument that the state-owned company is a Brazilian asset is not supported by its oil pricing policy, which is pegged to international rates. In addition, the House Speaker also said Petrobras has stopped making investments in infrastructure to improve its market positioning, instead focusing on distributing dividends to private shareholders.
According to Mr. Lira, there has been no discussion about changes in the company’s pricing policy. However, he reiterated that the real villain in Brazil’s fuel price spike is goods and services tax ICMS, set and charged by state governments.