Brazil Hikes Gas 10%, a First in Three Years

Brazilian gas station Brazil's Finance Minister, Guido Mantega, has just announced a 10% hike in the price of gasoline and 15% for diesel fuel, the first such increase since 2005. The increases refer to products from Petrobras, the country's government-controlled oil multinational, which sets the pace for the rest of the industry.

However, according to the government the new prices should not have a major effect on consumers' pockets since they will be compensated by a tax reduction ranging between 0.28 Brazilian real (17 US cents) to 0.18 teal (11 cents) per liter of gasoline. For diesel fuel the same tax will drop from 0.07 Real (4 US cents) to 0.03 Real (2 US cents) per liter.

Nevertheless at the end of the day diesel fuel price will rise 8.8%, which will have an impact of 0.015 percentage points on the inflation rate, according to Mantega.

A liter of gasoline currently costs in Brazil at the pump approximately 2.60 Real (US$ 1.56), and diesel, 1.90 Real (US$ 1.14).

The price hike announcement was anticipated on Wednesday during a press conference on the investment grade granted to Brazil by the risk rating firm Standard & Poor's. The Brazilian government had postponed price rises several times, fearing their impact on the country's inflation.

When Petrobras implemented the previous rise on its gasoline prices, the international oil price was US$ 65 a barrel. The oil barrel is now about US$ 112.

Gas prices around the world according to

Nation   City  Price in USD Regular/Gallon
Netherlands  Amsterdam  $6.48
Norway   Oslo   $6.27
Italy   Milan   $5.96
Denmark  Copenhagen  $5.93
Belgium  Brussels  $5.91
Sweden   Stockholm  $5.80
United Kingdom  London   $5.79
Germany  Frankfurt  $5.57
France   Paris   $5.54
Portugal  Lisbon   $5.35
Hungary  Budapest  $4.94
Luxembourg    $4.82
Croatia  Zagreb   $4.81
Ireland  Dublin   $4.78
Switzerland  Geneva   $4.74
Spain   Madrid   $4.55
Japan   Tokyo   $4.24
Czech Republic  Prague   $4.19
Romania  Bucharest  $4.09
Andorra    $4.08
Estonia  Tallinn  $3.62
Bulgaria  Sofia   $3.52
United States   $3.45
Brazil   Brasí­lia  $3.12
Cuba   Havana   $3.03
Taiwan   Taipei   $2.84
Lebanon  Beirut   $2.63
South Africa  Johannesburg  $2.62
Nicaragua  Managua  $2.61
Panama   Panama City  $2.19
Russia   Moscow   $2.10
Puerto Rico  San Juan  $1.74
Saudi Arabia  Riyadh   $0.91
Kuwait   Kuwait City  $0.78
Egypt   Cairo   $0.65
Nigeria  Lagos   $0.38
Venezuela  Caracas  $0.12



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