If Flávio Bolsonaro wins Brazil's presidential runoff on Oct. 25, he will give the state oil company Petrobras broad freedom to reshape its portfolio while seeking to bring more private investment into sectors dominated by the state-controlled producer, according to one of his energy advisers.
"What has been discussed about Petrobras is that it won't be privatized. Period," said Alexandre Chequer, an energy lawyer advising the campaign. Privatization was previously considered when Jair Bolsonaro, Flávio's father, was president until 2023. Chequer said decisions about Petrobras's operations, portfolio, investments and asset purchases or sales should be left to its future leadership.
The opposition candidate's surprise first-round victory earlier this month sparked a rally in Brazilian assets amid expectations of tighter fiscal policy and more market-friendly economics. Petrobras shares have jumped near 13% since the first vote, almost twice the gain of Brazil's main equities benchmark. Chequer said the campaign has not discussed fuel-pricing policy, including whether to restore import parity.
Chequer was critical of Petrobras's renewed push into fertilizers under incumbent President Luiz Inácio Lula da Silva, saying the company lacks expertise in the industry. He also said the refining market relies too heavily on a single company, and it remains undecided whether to revive the asset-sale program. The campaign has not yet addressed Braskem, the financially troubled petrochemical producer in which Petrobras holds a major stake and which is restructuring its debt. Chequer said the government should focus on improving the broader business environment, and a Flávio Bolsonaro government would aim to spur investment by cutting regulatory costs and streamlining approvals. Scrapping the current government's 12% tax on oil exports is among the most concrete energy proposals in the plan.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing