After further pressure from the Brazilian government over recent fuel price increases, the CEO of Petrobras has resigned. He had been dismissed by the president, but was still serving in an interim capacity.
This is the third departure from this position since Jair Bolsonaro’s election in 2019, as previous CEOs were not on the same page with him regarding the company’s fuel pricing policy.
Petrobras has unveiled the identity of the new interim CEO. He is Fernando Borges, Director of Exploration and Production. Thus, he will assume the functions until a new CEO is elected by the shareholders.
Upon the announcement of this decision, the company’s preferred shares fell by 5%. However, they quickly recovered and stabilized when the appointment of Fernando Borges was announced. His 38 years of experience in the company’s offshore division have reassured shareholders.
The uncertain future of Petrobras
Against the backdrop of a complex re-election process with soaring inflation and soaring fuel prices, the president is highly critical of Petrobras’ stewardship. Bolsonaro recently called the price hike “a betrayal of the Brazilian people.” He and Arthur Lira, a close collaborator, had mentioned the opening of a congressional investigation into the board of directors of Petrobas.
A board member took the initiative to propose a 45-day freeze on fuel prices. All this in exchange for the withdrawal of the government’s plan to reshuffle the company’s board and management. According to Petrobras, the company had not officially discussed this suggestion.
This resignation has provoked the reaction of several experts. While some see it as negative, others see it as hope. For expert Ilan Arbetman, the resignation of José Mauro Oelho could alleviate the political pressure on the company and the continuing uncertainty.
