August 9, 2012 / 12:25 AM / 5 years ago

Petrobras Brazil price rise not "on horizon"-Finance Minister

2 Min Read

* Brazil finance minister contradicts energy minister

* Finance minister Mantega also Petrobras chairman

* Price increases needed to stem losses-Petrobras CEO

By Luciana Otoni

RIO DE JANEIRO, Aug 8 (Reuters) - Brazil's state-led oil company, Petrobras, has not received approval for additional increases in domestic fuel prices and there is no increase "on the horizon," Finance Minister Guido Mantega, who is also chairman of the Petrobras board, said Wednesday in a statement.

His remarks contradict earlier comments by Energy Minister Edison Lobao that Petrobras may be able to raise prices again after increases in June and July.

After Lobao's comments, Petrobras' preferred shares rose 4.59 percent, their biggest gain in nearly two weeks, to 21.18 reais, their highest in more than three months.

Petrobras Chief Executive Maria das Gracas Foster has said new fuel price increases will be needed to stem losses in the company's refining division and to help pay for its $237 billion 2012-2016 investment plan, the world's largest corporate spending program.

As a result of selling fuel at below market values, Petrobras' refining division lost more than 11 billion reais ($5.45 billion) in the first six months of 2012. The refining losses helped push the company to post a 1.35 billion real loss in the second quarter, the company's first quarterly loss in more than 13 years.

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