Brazil's Diesel Cliff Has An Expiry Date: Goldman Says Petrobras Needs A ~50% Hike... Right After The Election

Governments can cap the price of diesel. They can't cap the price of the tanker that carries it.

That, in a nutshell, is the problem Brazil is about to run into according to Goldman's Brazil oil & gas team led by Bruno Amorim (with LatAm chief economist Alberto Ramos), whose note out late Wednesday is titled "Petrobras (PBR): Imminent diesel price hike ahead? Implications for PBR, fuels distributors, Brazil inflation" (available to pro subs). The question mark in the title is doing a lot of work, because the answer in the body is basically yes:

"21% Below International Diesel Parity"