Even as a producing country, Brazil is not immune to fluctuations in the international oil market. Changes in the price per barrel directly affect Brazil. fuelsInflation and the cost of living all influence the price of oil, but understanding how this value is determined helps explain why it changes so much. The price of oil doesn't depend solely on domestic production.
What is the price of oil and why does it fluctuate so much?
The price of oil is simply the price at which it is being traded on the market at a given moment. This value is usually expressed in dollars per barrel.
As it is a global commodity, small changes in the international scenario can cause large fluctuations. An increase in global demand, for example, tends to raise prices. Conversely, production exceeding consumption usually drives prices down.
But price behavior doesn't depend solely on the physical supply of the product. There's also the financial market. A significant portion of trading occurs through futures contracts, which are agreements to buy and sell for future dates.
In these cases, investors buy and sell "paper barrels," without intending to actually receive the oil. The goal is to profit from price fluctuations. This movement helps explain why oil can rise or fall even without immediate changes in production or consumption.
Generally speaking, the value of oil originates in the global market. Its price works like any other commodity: it depends on the balance between supply and demand. In other words, the final price is a result of what producers are willing to sell and what buyers are willing to pay at a given time.
This negotiation takes place mainly based on international benchmarks. The two most important are Brent, produced in the North Sea, and WTI, extracted in the United States. These benchmarks serve as the basis for contracts worldwide and directly influence the prices practiced in Brazil.
What influences the price of oil in the world?
The oil market is concentrated in a few countries. According to data from the Brazilian Institute of Petroleum and Gas (IBP), the United States leads global production, with about 16%, followed by Saudi Arabia and Russia.
On the consumption side, the United States and China appear as the largest buyers, accounting for significant portions of global demand. Any change in these countries, whether economic, political, or strategic, has a direct impact on the price.
Furthermore, there is the role of the Organization of the Petroleum Exporting Countries (OPEC), which brings together major producers. In 2020, the group was responsible for approximately 40% of world production and 60% of exports, according to the IBP (Brazilian Petroleum Institute).
Historically, OPEC adjusts its production to influence prices. When it reduces supply, it tends to raise prices. When it increases production, it pushes prices down.
How does the international price reach Brazil?
Even with significant production, Brazil is not isolated from the global market. Oil is traded internationally in dollars, and this means that the exchange rate also comes into play.
In practice, the price that reaches the country is impacted by two main factors: the international price of a barrel of oil and the value of the dollar. When oil prices rise abroad or the dollar appreciates against the real, the cost tends to increase domestically.
This trend became evident during the Covid-19 pandemic. Initially, the drop in circulation reduced global demand and drove down prices. With the resumption of activities, prices rose again, putting pressure on fuel prices.
How is the price of oil calculated in Brazil?
In Brazil, there is a specific mechanism for calculating the so-called Minimum Oil Price (PMP), used as a basis for the collection of royalties and other government participations. According to the Decree No. 11.175 / 2022The National Petroleum Agency (ANP) is responsible for this calculation, which is done monthly based on the average price of Brent crude.
This value is not a simple conversion. It incorporates a quality difference between Brazilian oil and Brent crude, in addition to currency exchange rate fluctuations. The final unit is expressed in reais per cubic meter.
According to the methodology defined by ANP Ordinance No. 206/2000, the calculation considers the monthly average of Brent crude oil, adjusted by a factor that reflects the yield of derivatives, such as gasoline, diesel, and fuel oil, obtained from that type of petroleum.
This difference takes into account the proportion of light, medium, and heavy fractions of the oil, as well as the international prices of these derivatives. In simple terms, the more valuable the products generated from that oil, the higher its final value tends to be.
Difference between the price of oil and fuels.
Although directly linked, the price of a barrel of oil and the price paid by consumers at the pump are not the same thing. There is a whole chain of costs between the two.
In the case of diesel, for example, the largest part of the final price comes from Petrobras, which accounts for 63,2% of the value. Taxes come next, at 11,7%, currently concentrated in the state ICMS tax.
There is also the participation of distributors and retailers, who account for 14,7% of the price. Another relevant component is biodiesel, whose mandatory blend with mineral diesel is at 10,4%, with an expected increase.
Gasoline, on the other hand, has a different composition. The fuel sold at gas stations is a mixture of pure gasoline and anhydrous ethanol, in a ratio of 73% to 27%.
In this case, taxes have an even greater impact, totaling 33,6% of the final value. Petrobras' share represents 38,8%, while anhydrous ethanol accounts for 13,2%. The remainder is spent on distribution and resale.
Why does oil affect the entire economy?
The impact of oil goes far beyond fuels. Because it is the basis for transportation and logistics, any price variation spreads throughout the economy.
When diesel prices rise, the cost of transporting goods increases. This ultimately translates to higher prices for food, industrial products, and services. That's why oil prices frequently appear in the news and directly affect consumers' wallets.
Even with advances in renewable energy sources, oil remains one of the most demanded commodities in the world. Its economic and strategic importance means that its price is closely monitored by governments, companies, and investors.
How does oil trading work in the market?
There are two main forms of trading. The first is the spot market, where buying and selling occur based on the current price, with almost immediate settlement. The second is the futures market, where contracts for delivery on future dates are traded. In this environment, oil becomes a financial asset.
Investors use these contracts to speculate on whether prices will rise or fall. Producers and refineries, on the other hand, use the futures market as a form of protection, guaranteeing prices and reducing volatility risks.
This system helps to provide predictability to the sector, but it also adds a layer of complexity to price formation.
Fluctuations in oil prices may seem unpredictable, but they are generally linked to three main factors: supply and demand, investor activity, and market sentiment.
Economic crises, geopolitical conflicts, or decisions by major producers can rapidly alter the global balance. At the same time, expectations about the future, such as economic growth or energy transition, influence investor behavior.
The result is a highly sensitive market, where the price of a barrel can change rapidly, reflecting both real factors and expectations.
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