Gram Slattery

RIO DE JANEIRO (Reuters) -Shareholders in Brazil’s Petrobras have elected José Mauro Coelho to the firm’s board, according to a source with direct knowledge of the matter, paving the way for the government technocrat to take the helm of the state-run oil company.

Petrobras annual shareholder meeting was held on Wednesday. It was ongoing until early Thursday morning. The main issue was Petrobras election of its 11 board members. The company’s statutes require that the chief executive be elected to the board.

Petrobras previously declared that its board would meet to officially appoint Coelho to the position of chief executive in the event of his election to the board.

His ascent to the top was expected since Coelho was tapped by Petrobras’ government. His statements in support of free market policies like pegging national fuel prices to international crude price rather than subsidizing Brazilians had won him the support of other shareholders.

The remainder of the board was a more contentious matter.

Going into the meeting, seven government seats were held. Market investors had three and workers one.

According to a source who was present at the proceedings but could not be identified because the event was closed to the press, market shareholders increased their participation to four. The government now has six members.

Petrobras didn’t immediately reply to my request for comment on the election results.

Market shareholders will be able to vote more, however analysts differ on whether the additional seat is important, since the government has a majority of seats.

Many Brazilians want Petrobras to limit the price hikes for petrol and diesel that have skyrocketed in recent months. This year is also an election year.

Jair Bolsonaro was elected President in March to replace Joaquim Silva e Luna, Petrobras CEO.

Adriano Pires was chosen later by the government as his successor, however Pires withdrew from public life days later. April 6. 6 the government named Coelho its new pick.