(Adds government comments and cost saving measures) RIO DE JANEIRO/SAO PAULO, May 31 (Reuters) – Brazil showed signs of returning to normal on Thursday as an oil workers union ended a strike ahead of schedule and an 11-day trucker protest appeared to wind down. Oil workers union FUP unexpectedly 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 court deemed the strike illegal, saying the action had political aims rather than labor-related goals. The end of the strike that had demanded changes at state-led oil firm Petroleo Brasileiro SA, commonly known as Petrobras, will come as a relief for the company, whose shares have tumbled around 30 percent in the past two weeks over fears that political interference would unwind recent investor-focused policies. While the effects on output were not immediately clear, the strike did not cause any losses for Petrobras as the company had contingency plans in place, said Brazil’s minister of institutional security, Sergio Etchegoyen, at a news conference. Meanwhile, the truckers protest, which has strangled much of Brazil’s economy for 11 days, petered out. Etchegoyen said all roadblocks had been removed, though isolated groups of truckers were causing problems. Highway traffic had returned to normal throughout Brazil, federal police said in a statement. Santos, Latin America’s largest port, was now functioning, Admiral Ademir Sobrinho said in broadcast comments. 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 cost more than usual 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 agreed to lower the average cost of fuel by 46 centavos ($0.12) per liter. To pay for the cuts, the government announced it would slash a subsidy for exporters and reduce benefits for beverage makers operating in the Zona Franca low tax zone, which will hit companies such as Coca-Cola Femsa SAB de CV and Ambev SA, a unit of Anheuser Busch InBev NV. Those measures, along will other cost saving moves, 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 Grant McCool and Rosalba O’Brien) Let’s block ads! (Why?)
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