Petrobras Announces 11.1% Reduction Per Cubic Meter in Natural Gas Price Charged to Distributors Following Drop in International Oil Barrel Price

The Quarterly Adjustments in Prices Charged by Petrobras to Distributors Consider the International Scenario of the Oil Barrel. The State-Owned Company Announced a 11.1% Decrease in the Price of Natural Gas Passed on to Companies. 

The scenario for natural gas distribution becomes even more favorable and witnesses a reduction in product prices on February 1. The state-owned company Petrobras announced a 11.1% decrease in the price of natural gas charged to distributors. The decision was made based on the prices of the Brent oil barrel in the international market. The company disclosed the price drop during the last quarterly adjustment stipulated in contracts with companies. 

Natural Gas Distributors Will Buy Fuel at a Lower Price After Announcement of Adjustments in Petrobras Prices

Starting February 1, Petrobras will charge less for the cubic meter of natural gas passed on to distributors of fuel in Brazil. 

The company announced a 11.1% reduction in the product’s price, due to the international scenario of Brent oil barrel prices. 

Recomendado para você

Oil and Gas

Major Oil, Gas, and Energy Event Will Take Place in Brazil: Macaé Energy Will Gather Petrobras, Equinor, Prio, Among Other Suppliers and Energy Executives for Business, Networking, and Employment Opportunities

The Technical Agenda and the Fair in the City of Macaé Should Boost Discussions on Investments, Energy Transition, and Development of the Oil, Gas, and Energy Chain in the National...

Paulo Nogueira

1

The reduction is in relation to the price practiced in the quarter from November to January. Contracts with natural gas distributors foresee quarterly price adjustments by Petrobras. 

Thus, analyzing the international scenario of oil barrel prices, the state-owned company announced a significant decrease in the product price in the national market. 

In a statement, the company informed that during this period, oil prices fell by 11.9% while the exchange rate experienced a depreciation of 0.2%, meaning that exchanging reais for dollars became 0.2% more expensive. According to the contractual forecast, there was also a reduction of 2.35 percentage points in the pricing formula of crude oil, the company added.

The Brazilian Association of Companies Distributing Piped Gas (Abegás) highlighted that natural gas distributors with contracts with the state-owned company will pass the price drop on to the final consumer. 

The goal is to enable the Brazilian fuel market to recover in early 2023. 

“We also highlight that distributors have other supply contracts on a smaller scale, with commercial conditions distinct from those practiced by Petrobras. The reduction applied contributes to the increased competitiveness of natural gas and the growth of this industry,” said Marcelo Mendonça, Director of Strategy and Market at Abegás. 

Natural Gas May Become Increasingly Attractive for Fuel Distributors After Price Adjustment by the State-Owned Company

The announcement of the reduction in the price of natural gas from Petrobras to distributors may open space for new companies in the oil and gas sector. 

This is because the product is becoming increasingly profitable. Furthermore, industry expectations are that the input will become more attractive to consumers and investors, especially after the approval of the New Gas Law. 

“Today, those who benefit the most are the companies, the large groups, which need to acquire directly from a single supplier, so it will increase efficiency and competition as well,” emphasizes economist and professor Cesar Bergo.

Although the price adjustments for natural gas do not reach the final consumer immediately due to state taxation, a decrease in final prices is expected. 

Petrobras’ decision to reduce prices will thus contribute to the oil and natural gas market, both for distributors and consumers.