Government will postpone withdrawal of gasoline subsidy, says minister

The deterioration of the situation in the Middle East will lead the government to adopt caution, according to the minister. Therefore, the removal of the gasoline subsidy will be reevaluated next week. According to members of the economic team, the export tax on oil, currently at 12%, will be maintained.

"Yesterday oil rose again to US$80 and then we have to cautiously adopt the subsidy withdrawal," Durigan told Rádio Gaúcha. "This week I was going to announce the withdrawal of gasoline, [but] I will analyze the withdrawal next week, because the price of gasoline is already having a different impact [than] what I was predicting."

This Wednesday (8), the United States attacked more than 90 military targets in Iran, burying the fragile ceasefire agreed between the two nations. The Americans accuse Iran of having attacked at least three commercial ships transiting the strait this Tuesday (7).

The resumption of attacks could lead to a new blockage of the Strait of Hormuz, through which around a fifth of the world's oil passes, raising the price of a barrel once again, which this Thursday (9) opened with a 2% increase.

In March, the government announced a package of diesel subsidies in response to the rise in prices caused by the War in Iran and the threat of a truck drivers' strike in Brazil. The package included the elimination of PIS/Cofins and a subsidy of R$0.32 per liter for producers and importers. An export tax on crude oil should finance the measures.

In May, the Executive announced a new subsidy, this time of R$0.89 per liter of national or imported gasoline, paid with Union resources.

Last Thursday (2), with the ceasefire between the USA and Iran in force, Finance Minister Dario Durigan announced that the government would begin to remove the gasoline subsidy. Before, on Tuesday (30), the federal administration had already removed part of the diesel subsidy - the equivalent of R$ 0.35 per liter.

"At the same time as we were ready to take measures, we have to be ready to return to the previous situation", stated the minister this Thursday. He highlighted that the ICMS exemption for diesel agreed with the states has already been terminated, as has part of the diesel subsidy.

RURAL DEBT

The government intends to issue a provisional measure in the coming days on rural debt renegotiations, after finalizing negotiations with parliamentarians, with the possibility of annual interest of up to 12% and a payment period of up to 10 years, Finance Minister Dario Durigan said this Thursday.

Durigan stated that the text, a "middle ground" between the government's initial intention and the parliamentarians' request, should generate an additional impact on the National Treasury of R$2 billion to R$3 billion per year, in addition to the existing cost of implicit subsidies from credit lines.

According to the minister, interest rates can be 6% per year for small producers, 9% for medium-sized producers and 11% or 12% for large producers. Regarding deadlines, the general rule should be 8 years, with a period extended to 10 years in cases of more serious climate losses, stated the minister.

The renegotiation will have a limit of R$8 million per CPF for farmers affected by climate change and R$4 million for those who suffered from changes in product prices.

MIXING ETHANOL IN GASOLINE

The minister also stated that the increase from 30% to 32% of the ethanol mixture in gasoline announced by President Lula will be a reality in the coming days.

The CNPE (National Energy Policy Council) meeting that would define the increase this Wednesday (8) was postponed due to the war, said Durigan. "As we were experiencing a change in prices during the beginning of the meeting, we will wait to see if there is any other necessary measure in the CNPE," he stated. "This does not affect the 32% decision."

The minister signaled that the government also wants to increase biodiesel in diesel this year, but did not offer a date for the implementation of the new blends.

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