Pro-Bolsonaro lawmakers introduce request for Petrobras inquiry

Pro-government lawmakers introduced on Tuesday a petition for the House to create a hearings committee investigating how Petrobras sets fuel prices at its refineries. Such committees require the support of one-third of the House (171 of 513 lawmakers) to be created — a threshold the government and its allies within the so-called “Big Center” could easily reach.

The petition was introduced by Congressman Altineu Côrtes, the whip of President Jair Bolsonaro’s Liberal Party. Fifteen other lawmakers co-signed the document. The committee’s stated purpose is to investigate “alleged irregularities in how fuel prices are set.”

A publicly traded but state-controlled company, Petrobras is torn between fulfilling a key role in public policy and optimizing value for minority shareholders. Since 2016, the company has pegged its oil prices to international rates — a policy which Mr. Bolsonaro has bashed publicly but not really intervened to change.

Since Petrobras last hiked fuel prices, on June 17, attacks against the company became more intense, with House Speaker Arthur Lira talking about “holding the board of directors accountable for these acts in bad faith against the Brazilian people.”

Petrobras controls roughly 85 percent of the local oil refining market and its prices have a huge impact on how much drivers pay at the pump.

Markets believed that the resignation of José Mauro Coelho as the Petrobras CEO would diffuse pressure for a congressional inquiry, especially as it is unusual for a sitting government to support an investigation into a state-controlled company with just over three months to go before Election Day.

But with fuel prices becoming an increasingly electoral hot-button issue, Mr. Bolsonaro and his allies wanted to show action to voters. The Workers’ Party, the biggest in the opposition, said it won’t support the inquiry — calling it a “smokescreen.”

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