written by bo, 2008-03-30 20:55:53

gasoline is so expensive here in Brazil?
The answer to your question.
"Getting that oil out of the earth's crust is a formidable challenge, most of Brazil's oil lies off its Atlantic coast, and Petrobras has become a global leader in ultradeep offshore oil extraction. "
Where do you think Petrobras got the money which enabled it to become the "global leader in ultradeep offshore oil extraction? " While you think about that also consider this fact. Petrobras imports more light crude oil than its export of heavy crude oil, exports which are only recent and are miniscule in the amount of barrels produced. That means most of the oil Petrobras produces is for domestic use. If Petrobras is not generating big profits from exports then the money for the continued development of Brazil,s oil and gas industry can only come from one other place, brazil's consumers.
Should Petrobras and the government reduce prices by providing subsidies as is the case in Venezuela? My answer to that question is no. Why?, because once any government or industry goes down the path of subsidies they become difficult to recind in the future. What Brazil need is more wholesalers and refiners which will lead to more competition and ultimately lower prices.

The following is what US tax payers get for subsidies that they provide to oil companies. Imagine if there was no competition.
Apr 1, 2008
WASHINGTON (CBS News) ― Top executives of the five biggest U.S. oil companies were pressed Tuesday to explain the soaring fuel prices amid huge industry profits and why they were not investing more to develop renewable energy sources such as wind and solar power.
The executives, peppered with questions from skeptical lawmakers, said they understood that high energy costs are hurting consumers, but deflected blame, arguing that their profits - $123 billion last year - were in line with other industries.
"On April Fool's Day, the biggest joke of all is being played on American families by Big Oil," Rep. Edward Markey, a Democrat, said as his committee began hearing from the oil company executives.
With motorists paying a national average of $3.29 a gallon at the pump (for gasoline, and $4.00 a gallon for diesel) and global oil prices remaining above $100 a barrel, the executives were hard pressed by lawmakers to defend their profits.
"The anger level is rising significantly," said Rep. Emanuel Cleaver, a Democrat, relating what he had heard in his district during the recent two-week congressional recess.
Irving-based Exxon Mobil and Houston-based Shell, BP America and Conoco-Phillipsjoined California-based Chevron in earning a combined $123 billion last year because of rising prices.
Exxon Mobil made a record $40.7 billion last year alone, reports CBS News correspondent Chip Reid.
Alluding to the fact that congressmen often do not rate very high in opinion polls, Cleaver told the executives: "Your approval rating is lower than ours and that means you're down low."
"I heard what you are hearing. Americans are very worried about the rising price of energy," said John Hofmeister, president of Shell Oil Co., echoing remarks by the other four executives from Exxon Mobil Corp., BP America Inc., Chevron Corp., and ConocoPhillips.
But the executives rejected claims that their companies' earnings are out of step with other industries and said that while they earn tens of billions of dollars, they also invest tens of billions in exploration and oil production activities.

"Our earnings, though high in absolute terms, need to be viewed in the context of the scale and cyclical, long-term nature of our industry as well as the huge investment requirements," said J.S. Simon, Exxon Mobil's senior vice president.
But Markey asked Simon why Exxon Mobil hasn't followed the other companies in investing in alternative energy. The four other companies reported spending as much as $3.5 billion in recent years on solar, wind, biodiesel and other renewable projects.
"Why is Exxon Mobil resisting the renewable revolution," asked Markey.
Simon said his company, which earned $40 billion last year, had provided $100 million on research into climate change at Stanford University, but that current alternative energy technologies "just do not have an appreciable impact" in addressing "the challenge we're trying to meet."
(However in 2006, "Exxon Mobil gave its retiring chairman Lee Raymond one of the most generous retirement packages in history, nearly $400 million, including pension, stock options and other perks, such as a $1 million consulting deal, two years of home security, personal security, a car and driver, and use of a corporate jet for professional purposes.")

Markey challenged the executives to pledge to invest 10 percent of their profits to develop renewable energy and give up $18 billion in tax breaks over 10 years so money could be funneled to support other energy and conservation.
The executives said the companies already are spending billions of dollars - more than $3.5 billion over the last five years - on renewable fuels such as wind energy and biodiesel, but rejected any tax increases.
"Imposing punitive taxes on American energy companies, which already pay record taxes, will discourage the sustained investment needed to continue safeguarding U.S. energy security," Simon insisted.
"These companies are defending billions of federal subsidies ... while reaping over a hundred billion dollars in profits in just the last year alone," complained Markey, chairman of the Select Committee on Energy Independence and Global Warming.