(Adds police say highway traffic normal, detail on new government policies and effects of protests on industry) RIO DE JANEIRO/SAO PAULO, May 31 (Reuters) – Brazil’s economy showed signs of returning to normal on Thursday as the largest oil workers union ended a strike well ahead of schedule and an 11-day truckers protest appeared to dissolve. Oil workers union FUP recommended on Thursday that members suspend a 72-hour strike they began on Wednesday after a court said the organization would be fined 2 million reais ($537,000) for each day the strike continued. The strike demanding changes at state-led oil firm Petroleo Brasileiro SA, commonly known as Petrobras, was the latest challenge for the company, whose shares tumbled nearly 30 percent in the past two weeks over fears that political interference would unwind recent investor-focused policies. Thursday’s decision by workers to end the walk-off appeared in part to be a reaction to the court ruling, which deemed the strike illegal, saying the action had political aims rather than labor-related goals. Meanwhile, a truckers protest, which has strangled much of Brazil’s economy for 11 days, appeared to wind down. Highway traffic had returned to normal throughout Brazil, federal police said in a statement around midday. Television images showed trucks flowing into Santos port, Latin America’s largest, for the first time in weeks. Gasoline supplies, which had become short in recent weeks as transport routes were blocked, returned to normal at 70 percent of locations, Aurelio Amaral, a director of Brazil’s ANP oil regulator, told Reuters. Still, the effects of the protests will linger. At gas stations in Sao Paulo, Brazil’s largest city, lines remained long. Produce at supermarkets remained expensive in some locations, even as supplies were returning to normal. Companies in the machinery industry were crafting plans with workers for collective vacations, while others were planning layoffs, the head of the industry’s trade group, Jose Velloso, told Reuters late on Wednesday, as an inability to obtain supplies or deliver products hit virtually all firms in the sector. To win over the blockading truckers, who were primarily protesting high fuel prices, the government had agreed to lower the average cost of fuel by 46 centavos per liter. To pay for the cuts, the government announced it would slash a subsidy for exporters known as Reintegra by a factor of twenty. That measure, along will other measures, such as reduction in tax benefits for firms in the chemical sector, will boost government coffers by 2.27 billion reais, authorities said. ($1 = 3.73 reais) (Reporting by Pedro Fonseca and Gram Slattery; Editing by Will Dunham and Grant McCool) Let’s block ads! (Why?)
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