Brazilian President Jair Bolsonaro has warned that “something will happen at Petrobras in the coming days”, after criticising the state-controlled company for raising fuel prices once again this year.

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Petrobras' share price was down more than 5% on Friday morning local time in the Sao Paulo Stock Exchange, with traders fearing potential looming interference in the company from the Brasilia administration.

In a live broadcast on social media on Thursday night, Bolsonaro said the government has introduced a two-month reduction in federal diesel taxes starting on 1 March to compensate for a new increase in fuel prices by Petrobras.

Petrobras on 18 February increased — for the fourth time this year — gasoline and diesel prices at its refineries to cope with the rise in crude prices on international markets.

'That is going to have a consequence' - Bolsonaro

The Brazilian government averted a potential truck drivers' strike earlier this month, but tensions are rising again after the series of diesel price hikes and a recent statement from Petrobras chief executive Roberto Castello Branco.

In the spotlight: Petrobras chief executive Roberto Castello Branco Photo: AFP/SCANPIX

“As the Petrobras president said a few days ago: ‘I raise prices here and I do not have anything to do with truckers.’ That is what he said. That is going to have a consequence, obviously,” Bolsonaro said.

He also said his government will not interfere in Petrobras fuel pricing policy but added the new rise in prices was “excessive” in his view.

Nearly three years ago, a clash between truck drivers and the administration of former Brazilian president Michel Temer — which paralysed the country for weeks over high diesel prices — led to the resignation of then Petrobras chief executive Pedro Parente.

Bolsonaro said the two-month cut on federal taxes on diesel is a temporary solution while the government studies a way to permanently reduce it to zero.

While the federal tax contributes to the overall final price costumers pay on gasoline and diesel at gas stations across the country, much of the burden lies on state taxes that Bolsonaro has no power to overthrown it.