September 27, 2018 / 6:36 PM / 19 days ago

Petrobras Distribuidora worried about end to diesel subsidies

RIO DE JANEIRO (Reuters) - Brazilian fuel distributor Petrobras Distribuidora SA is worried about diesel prices from January onward, after a government subsidy program is set to end, the unit’s chief executive said on Thursday.

The subsidiary of state-run oil company Petroleo Brasileiro SA, which is also known as BR Distribuidora, is concerned that global petroleum prices and a volatile Brazilian currency will create uncertainties for diesel prices after the subsidy ends, said BR Distribuidora CEO Ivan de Sa Pereira.

The Brazilian government instituted diesel subsidies as part of a deal to end a truckers’ strake in May that crippled the country’s roadways and held up the transportation of essential goods.

The company is seeking reimbursement with relevant government agencies for 25 million reais ($6.25 million) in losses sustained in June and July - before authorities changed the rules of the subsidy program to allow it to participate - Sa Pereira said at an event in Rio de Janeiro.

Petrobras Distribuidora is still looking for investors in convenience stores associated with its fueling station and plans to double its number of stores in the next three years, he said.

Reporting by Marta Nogueira; writing by Jake Spring; editing by Chizu Nomiyama and G Crosse

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