Gasoline prices keep falling in Brazil

The price of gasoline has fallen steadily since mid-June. Photo: Joa Souza/Shutterstock

The price of gasoline at the pump during the first full week of September was 2.5 percent lower than the week before, per data released Monday by Brazil’s National Oil Agency. On average, a liter of gasoline in Brazil cost BRL 5.04 between September 4-9.

A liter of diesel, meanwhile, cost an average BRL 6.88 during that time, a 0.3 percent reduction on the previous week.

The agency’s data shows that the cost of gasoline at the pump has now fallen for 11 consecutive weeks – a direct result of policies pushed for by the Jair Bolsonaro government, desperate to keep prices down ahead of the president’s re-election bid.

In late June, Congress approved a new law capping the state-levied ICMS tax on goods and services for energy tariffs. Since then, the price of gasoline has fallen by around 30 percent.

Meanwhile, state-controlled Petrobras has cut the price of its gasoline sold to distributors four times in two months. This week, the oil and gas giant reduced the price of cooking gas for the first time since April.

Falling energy and transport prices have underpinned the monthly deflation figures that Brazil posted in July and August.

President Bolsonaro is using this situation for his electoral campaign. “Let me be clear: the entire Senate bench of the Workers’ Party (of his main electoral rival Lula da Silva) voted against the reduction to the ICMS. That means that the Workers’ Party is against a reduction in fuel prices,” the president said in a video posted to his social media Tuesday.