Brazil's Petrobras lowers diesel prices for distributors as subsidy starts

Petrobras said it will cut diesel A prices for distributors by R$0.3515 per liter starting June 1, as Brazil activates a new federal subsidy framework designed to ease fuel-price pressure.

Reuters, citing the company, reported that the distributor price will fall to R$3.30 per liter from R$3.65, a 9.59% reduction.

The change follows a federal measure announced by Brazilian authorities earlier in May. Government statements said the framework was created to mitigate the impact of higher oil prices on fuels and that the diesel subsidy would take effect on June 1.

Petrobras said the discount applies to diesel A sold for road use. The company did not say in its statement how quickly the lower wholesale price would reach retail pump prices, which depend on distributors and fuel stations.

The move adds a new layer to Brazil's fuel pricing policy at a time when the government is trying to soften consumer costs while keeping the subsidy mechanism in place.