BLOOMBERG/ Peter Millard / Petrobras has lost a quarter of its market value this year and tomorow will post the smallest profit gain among the world’s largest oil producers with the exception of BP.... because of government controls on fuel prices. Petrobras cut gasoline prices by 4.5% and diesel 15% in June 2009 and hasn’t increased them since. Oil in New York averaged 31% higher in the second quarter than a year earlier. “The price in Brazil is a political price,” said analyst Adriano Pires. “Petrobras makes sure it doesn’t generate problems for the government.” Also Petrobras is spending too much on “political” projects, including new refineries, instead of the offshore drilling equipment needed to tap oil fields in the deep Atlantic, claims consultant Wagner Freire.
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