RIO DE JANEIRO, May 18: Brazil’s petroleum regulator, the ANP, plans to require minimum national stocks of gasoline and diesel and other fuels to reduce the risk of shortages as imports and domestic demand rise faster than output, storage and distribution capacity.

The decision, approved by the ANP’s board on Thursday, will force state-controlled oil company Petroleo Brasileira SA and other refiners to hold minimum fuel stocks and make investments in fuel storage and distribution systems, Florival Carvalho, a member of the board told Reuters.

While the exact amount of fuel refiners will be required to hold in reserve is still under study, Carvalho expects the level to be set at three to five days of Brazilian demand. At current demand rates that would require stocks of as much as 9.4 million barrels.

“Today there is no regulation in this area,” Carvalho said.

“What we are doing is requiring each producer to hold a minimum stock of fuel.” Petrobras, as the state-run oil company is known, is responsible for nearly all of Brazil’s oil production and fuel refining. Despite large investments and expanding production, domestic supplies have not kept pace with demand, forcing imports to rise.

With fuel terminal capacity near limits and fuel volumes rising, there is a risk of localised shortages like there were in 2012, the ANP said in a recent report.

In March, registered Brazilian fuel distributors sold 58.4m barrels of gasoline, diesel, fuel oil, kerosene, fuel oil and liquefied petroleum gas, or an average of 1.88m barrels a day, according to the ANP. March demand was 3.6 per cent greater than a year earlier and 1 per cent greater than a year ago.—Reuters