Gasoline has increased by 11.8% since Lula took office

The price of gasoline in Brazil has become 11.8% more expensive since the beginning of the President’s government Luiz Inacio Lula da Silva (PT). Fuel has become more expensive in all states, with 7 recording an increase of more than 15% compared to the last week of December 2022.

Amazonas was the state where gasoline became more expensive. According to data from ANP (Brazil’s National Agency for Petroleum, Natural Gas and Biofuels), the fuel is selling at R$6.30, 25.7% higher than that sold at the end of last year (R$5.33). Piauí was the country with the lowest change (3.1%).

tax return

The price increase is due to the resumption of tax collection. On March 1st, partial Pis/Cofins and Cide were again charged for fuel across the country. At the time, the increase was R$0.47 per liter of petrol.

On June 1, there was a change to the single-phase ICMS collection, which is a single rate that is now being charged by all states. The tariff of R$1.22 was higher than the tariff imposed in 20 states.

On June 29, the federal government resumed charging the full price of Pis/Cofins. The price of petrol increased by R$0.27 per liter, due to the new PIS/Cofins rate and another R$0.07 and because of Cide, with a total impact of R$0.34 per liter.

Petrobras pieces do not hold

Because of the tax return, Petrobras has announced fuel price reductions that are passed on to distributors. So far, the oil company has made 4 cuts, 3 of which occurred shortly after the tax return, specifically to mitigate taxes.

Gasoline outperforms diesel

The average price of petrol in Brazil became more expensive than the average price of diesel during the first six months of Lula’s government.

According to the National Agency of Ports, the main fuel for cars sells for R$5.63 at gas stations in the country, an amount that is 12.4% more than the price of diesel for trucks (R$5.01).

Gasoline was trading at a 33% lower price than diesel at the end of 2022. While the price of petrol increased by 13.5%, diesel had the opposite effect and its price fell by 21.5%.

The ethanol also rises

In the same period, the price of ethanol in Brazil has become more expensive in 21 states. Of this total, 7 recorded an increase of more than 10% compared to the last week of December 2022.

Sergipe and Amazonas had the highest fuel price indices in the period, with 20.1% and 19% respectively. The increase in the price of gasoline also had an impact on the price of gasoline, because the fuel is mixed with ethanol before going to the gas stations. The mixing ratio is 27% ethanol.

On the other hand, 7 states have reduced the price of ethanol. São Paulo recorded the largest decline, at 5.8%. The fuel was trading at R$3.78 at the end of last year and is currently selling at 3.71%.

The price in the nation’s most populous state has remained lower than it was until last year, even with the increase in ICMS collection on ethanol announced by Governor Tarcísio de Freitas (Republican). On June 30, Tarcísio decided to increase the fuel tax rate from 9.57% to 12%.