Brazil's state-owned oil and gas company Petrobras said Tuesday
Brazil's state-owned oil and gas company Petrobras said Tuesday that the acquisition of fuel distributor Ipiranga was aimed at keeping foreign players out of the Brazilian market.
Maria das Gracas Foster, director of Petrobras' subsidiary oil and gas distributor BR, said that any threat of invasion of imported products was of concern to the company.
Petrobras Director of Supply Paulo Roberto Costa explained that fuel prices in Brazil's neighboring countries are usually lower than those within Brazilian territory.
In neighboring Venezuela, state-owned company PDVSA subsidizes oil and gas production, allowing fuel prices to remain at less than a U.S. dollar per liter.
Costa said the domestic petrol distribution situation was unique and could not withstand the introduction of products with internationally competitive prices. This was because companies that enjoy government subsidies, such as those in Venezuela, do not pay the entire cost of the refining process, as is the case in Brazil.