Economy June 9, 2026 10:21 AM

Brazil to keep renewing fuel-price measures while Middle East conflict disrupts supply

Finance minister says tax exemptions and a diesel subsidy will be cautiously extended as long as the Iran war affects fuel availability

By Nina Shah
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Brazil’s finance minister said the government will continue to renew measures to restrain fuel costs while the Middle East conflict, which he identified as the Iran war, disrupts supplies. Recent steps include tax exemptions for cooking gas and jet fuel and a diesel subsidy introduced to keep prices lower during an election year.

Brazil to keep renewing fuel-price measures while Middle East conflict disrupts supply
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Key Points

  • Government will continue to renew fuel-price measures while the Middle East conflict affects supply - sectors impacted include household energy (cooking gas), aviation (jet fuel), and road transport (diesel).
  • Recent measures enacted: extended tax exemptions for cooking gas and jet fuel, plus a diesel subsidy to keep prices lower.
  • Renewals will be handled cautiously and are explicitly conditional on ongoing supply disruptions caused by the Iran war.

Brazil’s government will continue to extend temporary measures to limit fuel prices for as long as the Middle East conflict disrupts supply, Finance Minister Dario Durigan said on Tuesday.

Durigan said the current interventions will be renewed with care, stressing the link between the conflict and supply pressures. "We will carefully renew measures to mitigate the effects of Iran war on fuel supplies," he said. "As long as the war continues to have this effect, measures will be implemented."

Officials in recent weeks have acted to blunt price increases for several fuel categories. Last month the government extended tax exemptions covering cooking gas and jet fuel. In addition, a diesel subsidy was put in place to keep pump prices lower during a year when President Luiz Inacio Lula da Silva is expected to seek reelection.

The minister framed the policy approach as a calibrated continuation of existing steps rather than a broad new program. He emphasized that renewals of the measures will be handled cautiously, linking their continuation directly to the ongoing impact of the Iran war on fuel availability.


Context and implications

  • Measures already enacted include tax relief for cooking gas and jet fuel, and a diesel subsidy aimed at holding retail diesel prices down.
  • The government has tied the duration of these interventions to disruptions caused by the Iran war, indicating a conditional approach to future renewals.
  • Officials have emphasized caution in extending the measures, suggesting a focus on managing immediate supply-driven price pressures rather than committing to open-ended support.

What the government said

"We will carefully renew measures to mitigate the effects of Iran war on fuel supplies," Durigan said. "As long as the war continues to have this effect, measures will be implemented."

This statement underscores that the government’s interventions are directly responsive to the supply impacts coming from the Middle East conflict and will persist only while those impacts are present.

Risks

  • Duration and impact of the Iran war on fuel supplies remain uncertain - this affects energy, transportation, and aviation sectors.
  • Policy continuation is conditional and described as cautious - uncertainty around how long measures will be extended could affect market expectations and sector planning.

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