The oil lobby group claims that the export tax in Brazil is an obstacle to new investment

The 12% tax on exports of crude?oil, which was introduced by the Brazilian government about a month ago, is a barrier to new investment by oil companies, according to the head lobby group IBP, who said at an event held on Wednesday that the group may file a suit against the tax. The 12% export tax was created when oil prices spiked due to the U.S./Israeli war against Iran. At the same time, the government scrapped local taxes on fuel sales in order to reduce prices for consumers.

Roberto Ardenghy, IBP's head of the Oil & Gas sector, said that the tax was not appropriate.

Ardenghy said that the lobby group, which represents the oil majors of Brazil, would sue the Brazilian government to determine the legality and validity of the tax. However, if Congress reverses the decision or Brazil drops the tax, then the lawsuit won't be filed.

Brazil's Mines and Energy minister?Alexandre Silveira stated that oil companies are gaining money due to the Middle East conflict and can therefore "pay a bit more"? to help the government subsidise fuel.

At the same event,?Silveira said, "In exceptional circumstances, extraordinary measures."

In a panel discussion, Shell, Spain's Repsol Sinopec and France's TotalEnergies as well as Equinor, Norway and Exxon, all oil majors, stressed the importance of fiscal and regulatory stability in Brazil to allow new investments.

The government announced the tax launch a little over a month ago. It is a temporary measure that will last until 'the end of the year.' It is intended to increase domestic refining and secure internal supply. Reporting by Fabio Téixeira, Rodrigo Viga Gaier, and Marta Nogueira. Editing by Chris Reese and Rod Nickel.

(source: Reuters)