Petrobras announces new fuel hike amid criticism from Bolsonaro

The Brazilian state oil company Petrobras announced this Friday a new increase in gasoline and diesel, unleashing new criticism from President Jair Bolsonaro, who warned that the company "could plunge Brazil into chaos" in the face of soaring inflation.

Following the announcement, Petrobras' common shares tumbled 8.67% at 7:00 p.m. GMT after falling as much as 9.87% on the Sao Paulo Stock Exchange, amid political noise and fears of possible congressional measures to alter tax policy that governs the company.

The largest company in Latin America said in a statement that it will raise the price of gasoline at its refineries by 5.18% and that of diesel by 14.26% starting this Saturday, given "the challenging scenario in Brazil and the world," in reference to the war in Ukraine.

Petrobras stated that "it is sensitive to the moment that Brazil and the world are facing" and that it understands the impact "on the lives of citizens."

"However, when there is a structural change in the level of global prices, it is necessary for Petrobras to seek convergence with market prices," says the company, which also states that this measure eliminates "internal shortage risks."

The company's pricing policy follows the international price of crude oil.

The new increase applies three months after the last in the case of gasoline and 40 days for diesel.