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News > Brazil

Brazilian Petrobras Plummets Following Bolsonaro's Criticism

  • Falls in shares over 20 percent were reported in the Sao Paulo Stock Exchange and the New York Stock Exchange on February 22, 2021.

    Falls in shares over 20 percent were reported in the Sao Paulo Stock Exchange and the New York Stock Exchange on February 22, 2021. | Photo: Twitter/ @luanborgesXV

Published 22 February 2021
Opinion

On February 19, Bolsonaro appointed retired Military General Joaquim Silva e Luna as Petrobras president, replacing CEO Roberto Castello Branco. The appointment has been criticized since Joaquim Silva e Luna has no experience within the oil and energy sector. 

Brazil's Petrobras shares dropped by 21 percent on Monday after president Jair Bolsonaro questioned the company's policies and appointed a retired army general as its president. The plunge is valued at $12.6 billion.

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Bolsonaro had criticized the pricing policy, arguing that recent increments in oil price were "excessive." This as the far-right president showed concern over his popularity since the truckers, hardcore supporters of Bolsonaro, called for a general strike.

In response, Bolsonaro pledged last Thursday to eliminate taxes on cooking fuel and diesel for two months. On February 19, he appointed the retired Military General Joaquim Silva e Luna as Petrobras president, replacing the CEO Roberto Castello Branco. The appointment has been criticized since Joaquim Silva e Luna has no experience within the oil and energy sector.

Several analysts, including Credit Suisse, Santander, Scotiabank, Bank of America, Bradesco, and XP, lowered their Petrobras shares' recommendations. Moreover, falls in shares over 20 percent were reported in the Sao Paulo Stock Exchange and the New York Stock Exchange. The power company Electrobras also suffered a decrease in share value as a consequence of the Petrobras drop.

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