Brazil oil export tax in limbo as court suspends levy, government extends it

Brazil’s oil export tax was thrown into uncertainty on ​Thursday (27) after a local court ordered the suspension of ‌the levy while the government’s foreign trade chamber approved extending it for another 60 days.

The conflicting moves leave the future of the 12% tax, ​which is being challenged by oil companies, unclear and set ​up a potential legal battle between President Luiz Inacio ⁠Lula da Silva’s administration and oil producers.

According to Datamar, crude oil export volumes fell 24.2% in the first half of 2026 compared with the same period a year earlier. The chart below shows the main ports handling crude oil exports from Brazil:

Main Ports | Crude Oil | H1 2026 | WTMT

Source: DataLiner (click here to request a demo)

Foreign trade chamber Camex ​approved the extension of the tax, which had been due ​to expire early next month, for 60 days starting on September 8, the trade and industry ministry said in a statement.

However, a federal court had ​granted an injunction suspending the levy, according to a decision ​seen by Reuters.

The tax was introduced earlier this year as part of a ‌package ⁠of measures adopted by the Lula administration to shield consumers from higher oil prices following the U.S.-Israeli war on Iran and the closure of the Strait of Hormuz.

At the time, the government ​argued the revenue ​obtained from ⁠the tax would help fund fuel subsidies, including for diesel, gasoline, jet fuel and cooking gas.

The ​duty affected Brazil’s state-run oil firm Petrobras, which ​paid around ⁠4.9 billion reais ($948.27 million) in export taxes during the second quarter, regulatory filings showed.

The suspension of the tax could also benefit other major ⁠oil ​producers operating in Brazil, including Shell, ​Equinor and TotalEnergies.

Source: Reuters

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