Brazilian Authorities Demand to Reduce Gas Injection into New Oil Wells
The Brazilian president intends to fulfill his promise to reduce gas prices, so he ordered to reduce the injection of natural gas into new oil wells.
Brazilian President Luiz Inacio Lula da Silva has issued a decree according to which the regulator will monitor the reduction of gas injection into new oil wells, writes Reuters.
Thus, the Brazilian authorities intend to implement their plans to reduce gas prices in the country. This measure will be applied only to new oil wells, and existing contracts will not be reviewed.
Lula‘s government has previously stated that it will achieve a reduction in the cost of gas. And if we reduce the injection of gas into oil wells, then there will be more gas on the domestic market, according to the current authorities.
However, it is worth explaining that gas injection affects the productivity of oil wells, and if less gas is pumped, then oil production may decrease.
