On October 14 Petrobras announced a new policy for the pricing
of its oil products. The new rules frustrated those who expected
major changes, but nevertheless amount to an important step towards
competitive markets in the downstream segment of the oil & gas
industry in Brazil.
The most important innovation is the fact that prices of oil
products will be reviewed often. A newly instituted Executive Group
for Markets and Prices will meet at intervals which shall not
exceed one month in order to set new prices in the light of the
evolution of international markets, the exchange rate and other
relevant factors.
Previous administrations at Petrobras typically referred to the
need to avoid excess volatility as a justification to keep prices
unchanged for long periods of time. This often led to wide gaps
between domestic prices and international ones; this practice now
seems to be have been abandoned, and this is welcome. The federal
administration itself implemented
