We have previously compared gas prices around the world and also explained why Brazil’s fuel prices are still about 80% higher than the US, something hard to grasp considering the country’s “self sufficiency” in oil. Well, an interesting post (in Portuguese) illustrates the math behind the outrageous fuel prices that the Brazilian consumer has to deal with… here is the composition of the gasoline price (in Real \$), based on 2011’s prices:

800ml of Gasoline (pure, sold by Petrobras) = R\$ 0.80
200ml of Anhydrous Alcohol (20% mixed with gasoline) = R\$ 0.24
Total Product Cost = R\$ 1.04 / liter
+
CIDE – PIS / COFINS (Federal Tax) = R\$ 0.44
ICMS (state tax) = R\$ 0.64
Total Cost of Taxes (104% of the Price) = R\$ 1.08
TOTAL (product cost + taxes) = R\$ 2.12

+
Distributor’s Fee (Average per Liter) = R\$ 0.08
Freight (Average per liter) = R\$ 0.02
Gas Station Margin (Average per liter) = R\$ 0.25

Summary::

Price at the Pump = R\$ 2.47
Price at the Pump (if taxes are removed) = R\$ 1.39

So if the average Brazilian driver consumes 200 liters of gasoline per month, the profit pie is divided as follows:

Car Owner spends: R\$ 494.00
Gas Station earns: R\$ 50.00
Truck Driver (freight) earns: R\$ 4.00
Petrobras earns: R\$ 16.00
Government earns: R\$ 216.00

The Brazilian government wins again… and the consumer pays the price.

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