Petrobras Backs New R$1.00/Liter Diesel Subsidy, Cumulative Fuel Payments Hit $1.9 Billion

Petrobras (NYSE: PBR) said its board approved participation in a new diesel subsidy under Provisional Measure 1,391, providing R$1.00 per liter of diesel A for 30 days, with an option to extend another 30 days. The program can run alongside an existing R$1.12-per-liter diesel subsidy under Provisional Measure 1,363, with benefits cumulative. The state-controlled oil giant also received R$448 million ($85 million) for gasoline sold July 16-31 under Provisional Measure 1,358, lifting cumulative government fuel-support receipts to R$9.9 billion ($1.9 billion). Petrobras raised its diesel A distributor price by R$1.00 per liter from September 17, offset by an equivalent subsidy-backed discount. The gasoline program expired September 9, prompting Petrobras to end a R$0.44-per-liter discount on September 10. The subsidies let Brazil fund fuel-price support through the federal budget rather than having Petrobras absorb below-market discount costs. Formal participation remains subject to regulatory approval.