Even though Brazil produces more oil than it consumes, it still pays a high price for gasoline. Find out how internal and external factors influence the price at gas stations

Written by Noel Budeguer

Published 10/05/2025 às 09:54

Even though Brazil produces more oil than it consumes, it still pays a high price for gasoline. Find out how internal and external factors influence the price at gas stations

The price of gasoline rose more than 50% between 2020 and 2022. See why it remains high and what really weighs on the amount that reaches your pocket

For those who drive frequently — or even for those who just consume transported products — the price of gasoline in Brazil is a constant burden. The increase in the price of fuel impacts the entire economic chain: it increases the cost of transporting goods and, consequently, makes almost everything on the market more expensive. But after all, why is Brazilian gasoline so expensive, even though it is a country with abundant oil reserves?

What is oil and why is it so difficult (and expensive) to explore?

Oil is a natural mixture of hydrocarbons that originated from the decomposition of algae and small marine organisms over millions of years. Contrary to what many people believe, dinosaurs had nothing to do with it.

Extracting it, however, is a technological feat. The reservoirs are often kilometers deep. In Brazil, Petrobras dominates this process. Founded in the 1950s, the state-owned company is now one of the largest oil companies in the world, responsible for more than 3 million barrels per day. However, this does not mean that we are free from international influence — far from it.

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From the well to the gas station: where does your money go?

Did you know that when you fill up your car with R$100 worth of gasoline, less than half of that actually goes to Petrobras? According to the company's own updated data, the breakdown is approximately as follows:

Petrobras: $ 36
Distribution and resale: $ 17
Anhydrous ethanol: $ 13
Federal taxes: $ 22
State taxes: $ 11

This shows that almost half of the price comes from internal policies, especially taxes. The rest depends on global variables.

The impact of the dollar and the barrel on your pocket

Despite robust domestic production, Brazil still imports petroleum products. This is due to our low refining capacity — refineries are few, old and adapted for heavy oil, while the Brazilian pre-salt offers light oil, more noble, but little used here.

Consequence? We sell part of our crude oil abroad, buy it back already refined… and pay in dollars. As a result, any global instability could cause the price to skyrocket here.

That's what happened in Ukraine war, when the barrel reached almost US$ 140. Or during the pandemic, which first dropped demand, and then caused a rebound effect with increases of up to 50% between 2020 and 2022.

The problem of pricing policy

Until recently, Petrobras used the so-called Import Parity Policy (PPI), which tied the domestic price of fuels directly to the international market. In 2023, the state-owned company abandoned the PPI, adopting a new pricing policy which takes into account internal and regional factors.

Despite this, the reduction in the average price of gasoline was only 5%, according to analyses by the sector itself.

On May 16, 2023, Petrobras president Jean Paul Prates announced the end of the Import Parity Policy (PPI), which meant that fuels had prices aligned with those of the international market, even though they were produced in Brazil by a state-owned company.

Possible solutions (and their challenges)

1. More refineries?

An obvious answer would be to build new, modern refineries capable of processing the pre-salt light oil. But this would require billions in investment and decades to complete.

2. Investment in clean energy

Another solution is to gradually replace fossil fuels with renewable sources. Solar, wind energy and the use of eletric cars are real promises. However, they also have challenges — such as the environmental impact of batteries — and require infrastructure.

3. Quality public transport

Reducing the number of cars on the road is one of the most effective ways to cut gasoline consumption. Cities with efficient public transport consume less fuel and offer a better quality of life.

An inevitable transition

Oil is the black gold of the 20th century, but it may not be the fuel of the future. Even today, its influence is so great that conflicts in distant countries directly affect the budget of Brazilians in any corner of the country. But as renewable energy becomes more viable, both ecologically and economically, the tendency is for dependence on oil — and volatile gasoline prices — to diminish.

As with any transition, there will be costs and resistance. But the current scenario is not sustainable, and the future demands bold changes.

How much does a liter of gasoline cost in your city today? Leave a comment and follow the evolution of these prices with us.

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Even though Brazil produces more oil than it consumes, it still pays a high price for gasoline. Find out how internal and external factors influence the price at gas stations

The price of gasoline rose more than 50% between 2020 and 2022. See why it remains high and what really weighs on the amount that reaches your pocket

What is oil and why is it so difficult (and expensive) to explore?

From the well to the gas station: where does your money go?

The impact of the dollar and the barrel on your pocket

The problem of pricing policy