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Brazil prepares for knife-edge election

  • Märkte: Crude oil, Natural gas
  • 02.10.26

Brazilians go to the polls on 4 October for what looks set to be the tightest presidential race in recent history, with candidates' energy platforms also closer than in past elections.

Incumbent president Luiz Inacio Lula da Silva, who is seeking re-election for a fourth, non-consecutive term, leads voting intentions with 40pc. He is statistically tied with Senator Flavio Bolsonaro with 36pc, according to The Economist's 30 September poll tracker, which aggregates results from the main national polls.

No other candidate is polling above the low single digits.

If no candidate secures more than 50pc of the valid vote on 4 October, there will be a runoff between the two leading candidates on 25 October.

Lula has campaigned on his legacy of social welfare programs and the defense of national sovereignty. In recent weeks, the government announced a flurry of measures designed to appeal to poorer voters, including an increase in benefits payments and a ban on online betting.

Bolsonaro is standing in for his father, former president Jair Bolsonaro, who is serving a 27-year sentence under house arrest for attempting a coup after losing the last election to Lula.

Although the son cuts a more moderate figure, he is widely expected to emulate much of his father's far-right agenda. The younger Bolsonaro promises a hard line on crime and has said he will seek an amnesty for his father if elected.

In a tepid campaign marked by voter fatigue with corruption and the cost of living, and overshadowed by a multi-billion reais banking scandal implicating top judges and politicians, concrete proposals on issues like energy policy have taken a backseat.

Both candidates are expected to seek more investment in oil and natural gas production alongside developing greener energy sources like biofuels, although their approach may differ.

Lula, a statist, has indicated that state-controlled Petrobras would remain at the center of Brazil's energy policy and has spoken of the state re-entering the fuel distribution market.

By contrast, Bolsonaro would likely pursue a more market-friendly route. He has spoken of revoking a temporary 12pc tax on crude exports — introduced by the Lula government to mitigate the price impact of the Middle East war — and of dropping the widespread production-sharing model of oil exploration contracts for the industry-preferred concession regime.

A US-shaped shadow

Hanging over the elections are concerns with possible interference by the US.

On 1 October, Brazil's solicitor general asked the federal police to investigate alleged financing of far-right agendas by President Donald Trump's administration. Lula's Workers' party filed a similar request with the supreme court last week, raising concerns about foreign meddling to benefit Bolsonaro.

In a 24 September letter to secretary of state Marco Rubio, Democratic members of Congress denounced "a sustained, multifaceted campaign of interference and destabilization in Brazil" by US officials.

President Trump is a long-standing ally of the Bolsonaro family and has leaned on elections elsewhere in the region to help get allies into office.

Bolsonaro plans to join Trump's Shield of the Americas security alliance if elected and is perceived as a more pliable partner on matters like rare earths cooperation.

Trump said on 1 October that he is watching the Brazilian elections "very closely".


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