Brazil’s Petrobras CEO Resigns, Stock Price Drops 15 Percent

By Lise Alves, Senior Contributing Reporter

RIO DE JANEIRO, BRAZIL – Trying to ease uncertainty after the resignation of Petrobras president Pedro Parente on Friday morning, Brazilian President, Michel Temer, announced Parente’s successor and stated that the government will not interfere in fuel price policies.

Parente’s decision to leave the command of one of Brazil’s largest state-owned company led to severe volatility in Brazil’s Stock Market (BOVESPA), which fell by more than 1.6 percent before closing up by 0.63 percent. Petrobras shares, however, registered a loss of 14.9 percent on Friday due to Parente’s resignation.

“I reaffirm that my government remains committed to the recovery and financial health of the company,” President Temer told journalists on Friday night after announcing that Ivan Monteiro would be taking over as Petrobras’ CEO.

“We will continue with the economic policy that in those two years took the company from the loss and brought it to the list of the most respected in Brazil and abroad.”

Temer concluded, “I also declare that there will be no interference in the pricing policy in the company.”

Monteiro was the executive director of Petrobras’ Financial and Investor Relations Department, until Friday when he was tapped for the CEO role.

Parente resignation was celebrated by two of the country’s largest trade union federations, which had demanded his ousting during the recent nine-day truck drivers’ strike.

“The departure of the president of Petrobras, Pedro Parente, will only bring benefits to the Brazilian society,” said the statement issued by Força Sindical, adding that the former CEO’s fuel price policies only harmed the working class.

Pedro Parente headed of Petrobras for the past two years, pulling the weakened company out of the red, restructuring the oil giant and selling off smaller subsidiaries which were not part of its ‘core business’.

Under his command, Petrobras’ fuel price policy of readjusting the price of fuel at refineries on a daily basis led to stiff criticism not only from opponents but also from government allies.

According to local source, Parente told President Temer that as a CEO he had ‘stopped being positive’ for the country and that the government needed to consider ‘alternative’ pricing policies.