Explaining Brazil #294: Lula switches on intervention mode

Author

Euan Marshall
May 22, 2024 • Reading Time: 3 minutes

During the government of far-right former Brazilian President Jair Bolsonaro, talk of personnel changes and uncertainties surrounding state-controlled oil and gas company Petrobras were commonplace.

In fact, during Bolsonaro’s four-year term, the oil major had four different CEOs, and suggestions of government interference in Petrobras became statements of fact, as opposed to mere insinuations.

And now, around 17 months into the Luiz Inácio Lula da Silva government, Petrobras has seen its first CEO change of this administration, with the quote-unquote “resignation” of Jean Paul Prates last week, and the imminent appointment of Magda Chambriard to take his place.

This week on Explaining Brazil, we’re going to dig deeper than the exit of Jean Paul Prates, looking at the Lula government’s plans for Petrobras, and suggestions that the administration could be looking to step up its strategy of state capitalism.

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Background reading:

  • Replacing the Petrobras CEO adds to Lula’s attempt to interfere in Vale months earlier. And there are future concerns about the Central Bank

  • Read Diego Bonomo’s Brazil analysis on Covington & Burling’s Global Policy Watch, here.

  • Our Brazil Daily newsletter picked apart the news of Jean Paul Prates’ firing the morning after, showing that the government was keen on increased control over Petrobras. 

  • One of the last victories for Mr. Prates as CEO of Petrobras was when the board voted to overturn a company decision not to distribute extraordinary dividends to shareholders. 

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