Threat of a Petrobras hearings committee a ruse by the government

House Speaker Arthur Lira talked about opening "Petrobras' black box." Photo: Paulo Sérgio/CD

After Petrobras announced a hike in gasoline and diesel prices, President Jair Bolsonaro and some of his most powerful allies in Congress reacted by defending the creation of a congressional hearings committee to scrutinize the company’s finances.

The president, however, is writing checks he is not willing to cash. A hearings committee requires that one-third of House members sponsor a request for its creation — but no such request has been made to the House’s directive board, The Brazilian Report has confirmed.

The threat of holding hearings is yet another electoral stunt that the president is resorting to as a way of showing voters that he is trying his best to prevent fuel prices from climbing further. Gasoline prices are up by 27 percent since June 2021, and two-thirds of Brazilians are in favor of some sort of intervention to tame prices at the pump.

“Talks of a hearings committee are only to serve as a smokescreen for the truth: that the government has no legal power to force gas prices down,” said Congressman Fausto Pinato from São Paulo, a conservative lawmaker who has distanced himself from the administration.

While Mr. Bolsonaro in reality had little desire to scrutinize Petrobras, the pressure resulted in a positive outcome for him — pushing José Mauro Coelho to resign as the company’s chief executive officer. The Mines and Energy Ministry had announced a change in CEOs a month ago, but that process is lengthy and requires approval from minority shareholders.

By resigning, Mr. Coelho allowed the government to name an interim CEO of its choice immediately. The pick was Exploration and Production Officer Fernando Borges — a move markets reacted to well.