Petrobras, Brazil's state-controlled oil company, has declared an increase of 11.6% in diesel prices for distributors starting Saturday (14), marking the end of over 400 days without price hikes. This decision comes as a direct consequence of the escalating conflict in the Middle East, which has influenced global oil prices. With the cost of oil surging from $60 to over $100 per barrel, Petrobras is forced to adjust its prices to reflect new realities in the international market and to continue meeting domestic demand.

The increase will raise the price of diesel sold to distributors by R$ 0.38 per liter, bringing the new price to R$ 3.65. To alleviate some of the financial burden on consumers, the Brazilian government has removed the PIS and Cofins taxes on diesel, which will result in a R$ 0.32 discount per liter for distributors. This adjustment aims to mitigate the impact on consumers amidst rising fuel prices driven by global market conditions.

Petrobras has scheduled a press conference to further explain the rationale behind this price adjustment, emphasizing the importance of balancing internal prices with the fluctuations of the global oil market. This situation reflects the broader implications of international conflicts on local economies and highlights Brazil's reliance on imported oil to meet 30% of its diesel demand, indicating potential challenges for Brazilian consumers in the future as global prices continue to fluctuate.