Markets react positively to new Petrobras CEO

Markets react positively to new Petrobras CEO
Photo: Vintage Tone/Shutterstock

The share price of Brazil’s oil and gas giant Petrobras dropped over 2 percent yesterday amid fears of government interference as it became clear that President Jair Bolsonaro would replace the company’s CEO, Joaquim Silva e Luna. Today’s trading, though, saw Petrobras open more than 3 percent up.

Adriano Pires, the government’s chosen successor at the helm of the company, has been well received by markets. On multiple occasions, he has defended the company’s pricing policy of pegging local prices to international fares – and said that the government must find alternatives to mitigate the effects of the surge in oil prices on consumers.

Petrobras’s latest price hike came on March 10. Three days later, Mr. Pires wrote on finance website InfoMoney that the company had made a mistake in waiting over 50 days to make the move.

Despite the change in leadership, Itaú BBA, Bradesco BBI, and Credit Suisse will keep Petrobras shares labeled “outperform.”