Brazil's oil workers' strike has ended, but the problems of state owned Petroleos Brasileiro SA continue.
A judicial minister with Brazil's federal accounting tribunal sharply criticized Brazilian oil policies and Petrobras operations while ordering an audit of the state company's operations. Aepet, the Petrobras association of engineers, requested the audit (OGJ, June 25, p. 28).
STRIKE AFTERMATH
The Petrobras oil workers' oil strike, which began June 14, ended June 22.
Workers did not achieve their main demands, which included a 166% wage hike for the September 1989-September 1990 contract period and an end to layoffs. The oil workers' strike was in response to reported plans by Petrobras to lay off as many as 16,000 of 60,000 workers.
Private industry officials estimate as many as 2,0004,000 Petrobras workers have been discharged. Petrobras and union officials would not confirm those estimates.
The strike paralleled labor actions in other state owned industries across the country sparked by austerity measures of the new government of President Fernando Collor de Mello that called for the layoff of about one fifth of all public sector workers.
Labor union officials attributed apparent failure of the oil workers' strike to divisions among 19 unions representing Brazil's oil workers. On July 2, Brazil's Superior Workers' Tribunal will judge legality of the dismissals and the disputed contract between the previous government and oil workers that unions say guaranteed job security and the wage hike.
However, the oil workers may benefit from an overall concession the government is making to halt massive public sector strikes.
Collor's administration is introducing a provisional measure to raise wages 126% for all public sector workers for the September 1989-September 1990 contract period.
This new position represents a major reversal of government policy not to consider any further wage hikes. There was no report, however, on whether public sector layoffs would continue.
OIL POLICIES CRITICIZED
In accepting the audit request by Aepet, tribunal Judicial Minister Marcus Villaca said, "The crisis at Petrobras is due to the incapacity of the state to conduct its own strategic programs."
In requesting the audit, Aepet called on the government to revise the framework of state enterprises.
Although Collor's economic reforms have focused on privatization of state owned industries, Brazil's oil industry has been considered off limits to privatization under that country's new constitution.
However, some private industry sources in Brazil see the audit and government ordered layoffs as de facto efforts to weaken Petrobras to the point of forcing some form of privatization.
FINANCIAL CRUNCH
Aepet claimed Petrobras policies imposing controlled prices for petroleum products have led to a severe cash flow crunch that in turn has slashed the company's upstream investment and crippled profits.
Aepet noted that in the first 9 months of 1989, Petrobras incurred losses of about $1.67 billion due to the difference paid for imported crude and the price it charged for petroleum products. The subsidy for petrochemical naphtha alone sliced Petrobras revenues by $4 billion during 1980-89, Aepet charged.
Further, Petrobras lost $650 million in that period as a result of its "complex maze of efforts at commercializing fuel alcohol," Aepet said.
SUBSIDIES ASSAILED
Villaca concluded that the gap between the price Petrobras paid for imported crude and the respective price it received for petroleum products averaged 67% during 1974-89. Except for 1985 and 1989, sharp crude price hikes during that period were not passed on to domestic consumers, Villaca said.
Further, Petrobras companies didn't pass through rising production costs, adding to the subsidy, Villaca said.
"Generally, this means that the situation ended up provoking a decapitalization of the state companies, hampering their ability to finance themselves and creating a distorted profile for demand."
Aside from the negative financial consequences, government policies also drained domestic oil and gas reserves, thus endangering prospects for self-sufficiency by penalizing the backout of imported oil, Villaca said.
The tribunal also said Petrobras was inefficient in utilizing oil and gas supplies.
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