The Evolution of Brazilian Oil, Gas and Biofuel Industry Regulations

Abstract

This chapter aims to present the main points of the Brazilian oil, gas and biofuel industry regulation evolution. The first legislative provisions aimed at regulating the oil industry emerged in the period of imperial Brazil, reaching truly consecration in the legal system at the first part of the twentieth century. At that time, the oil production was an activity strictly monopolized by the state; however, this monopoly came to be more flexible, and that is how it is nowadays. Regarding the natural gas industry, the history is pretty much the same because its legislation emerged as appendices of the oil industry regulation system. At the beginning, the gas used was manufactured from coal, and its main application was to provide electricity for the city. In fact, the birth and development of the natural gas industry in Brazil are recent. With the oil crisis came the development of the biofuel legislative regulatory system, considering biofuels as a potential substitute for fossil fuels, but until these days, there has been no great expansion in their use, despite Brazil’s potential for renewable energy sources. Besides the Federal Constitution and the specific sector rules, oil, natural gas and biofuel industries are regulated by the Oil Law (Federal Law No. 9478/1997).