A fuel price increase for Petróleo Brasileiro SA announced late on Tuesday fell short of expectations across-the-board, analysts at Credit Suisse Group led by Emerson Leite said in a note.
In terms of the size of the increase, the 6.6 percent hike for gasoline and the 5.4 percent for diesel - both at the refinery level - fell short of market expectations between 7 percent and 10 percent, Leite and his team wrote on Wednesday.
In terms of the stock performance, the analysts think there is no clear direction following the price hike. And in terms of government support - Petrobras, as the company is known, is controlled by the federal government - "that support may not be enough."
"In any case, individual price increases do not change our more cautious view towards the shares," the analysts said. "And they do not change our view because they do not address the parity mismatch issue - which means that pricing policy remains away from market pricing - and imply the imports will continue to be loss-making, and an earnings- and cash-drag for the company."