September 20, 2019 / 12:45 AM / 2 months ago

Brazil's Bolsonaro wants probe of potential gas station 'cartel', reviving old debate

BRASILIA, Sept 19 (Reuters) - Brazilian President Jair Bolsonaro said on Thursday that potential price fixing in the gas station industry needs to be investigated, reopening an old debate in Brazil over prices at the pump.

Bolsonaro said on Facebook Live that gas prices at refineries are below what they were in the middle of last year even after state-run oil firm Petroleo Brasileiro SA hiked gas and diesel prices this week in response to an attack on Saturday on oil facilities in Saudi Arabia.

Consumers are paying more than they should be, Bolsonaro said.

“Now, a detail: the price at the refinery today is lower than, if I’m not mistaken, July of last year, despite this 3% increase,” Bolsonaro said. “We know that at the end, at the pump, the prices don’t follow.”

Mines and Energy Minister Bento Albuquerque would contact the Brazilian oil regulator, the ANP, “to see what’s happening -a cartel, or whatever it may be,” Bolsonaro said.

Brazilian authorities under other governments have complained about possible price fixing by gas stations. Police in the southern state of Parana opened a price fixing investigation last year against the three largest gas station chains: Raizen, Ipiranga, and Petrobras Distribuidora SA , branded BR Distribuidora. The firms denied wrongdoing at the time.

Ipiranga is a unit of Brazil’s Ultrapar Participacoes SA and Raizen is a joint venture between Cosan SA and Royal Dutch Shell PLC. Petrobras Distribuidora, previously a unit of Petroleo Brasileiro, better known as Petrobras, was privatized via a share offering in July.

The gas station industry in Brazil generally blames high prices on a high tax burden and says the structure of the industry, with 40,000 gas stations throughout Brazil, would make widespread price fixing impractical. (Reporting by Ricardo Brito; Additional reporting by Roberto Samora and Gabriel Araujo in Sao Paulo; Writing by Gram Slattery; editing by Grant McCool)

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