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Update: Market Chatter: Brazil to Extend Subsidy on Gasoline Purchases

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(Updates with the finance ministry's confirmation in the 2nd paragraph.)

Brazil will prolong a subsidy on gasoline aimed at limiting fuel prices in the midst of conflict in the Middle East, until at least Sept. 9, Reuters reported on Tuesday, citing two sources.

In an emailed response toon Wednesday, Brazil's finance ministry said that the subsidy had been extended until Sep. 9, with a notification now published in the country's official journal.

The subsidy of 0.44 reais ($0.09) had been set to expire on Wednesday, after previously being extended for 30 days from July 26.

The latest extension was limited in duration by the upcoming Sept. 9 expiry of a presidential decree through which the subsidy was introduced, after which its continuation would be up to the country's congress.

Brazil's unique nationwide fleet of flex-fuel cars that can run on gasoline, domestically-produced sugarcane ethanol or any mix of both, provides a partial buffer to the influence of external events on its energy prices.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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