Brazilian hydrous ethanol prices will have to fall further after Petrobras cuts gas prices again

In Brazil, ethanol prices may be forced to fall even further in line with Petrobras’ cuts to gasoline prices. On Thursday the oil major announced a 5.4% price cut effective immediately, meaning a 2.4% price drop at the pump. The latest figures from the energy agency ANP show that hydrous ethanol prices had fallen below the 70% ethanol price parity with gasoline but drivers don’t calculate prices themselves, they just choose hydrous when there is more than 1 real price difference at the pump. So in order to achieve that difference and boost demand, mills may have to cut prices.