Ethanol to take over 74% of Brazilian market

Sugar cane-based ethanol fuel is expected to take over 75% of Brazil’s light vehicle fuel market by 2020, Petroleo Brasileiro SA (Petrobras) said. According to Petrobras, increase in ethanol use will shrink the market of gasoline to 17%. Flex-fuel engine technology, which is now available in about 90% of all new car sales, is the reason that Brazilians are buying more ethanol fuel, said Jose Sergio Gabrielli, chief executive of state-owned oil company Petrobras. Currently, ethanol represents just under half of the light vehicle fuel market. The growth in Brazil’s flex-fuel car market is unique in the world due to Brazil’s capacity to produce and distribute massive quantities of ethanol on the retail fuel market at competitive prices due to local growing conditions. Petrobras reportedly is optimistic of Brazil’s capability to produce sugar cane-based biofuel, due to its vast tracts of land. While Petrobras is known for its offshore oil exploration, company officials said it recognizes the rising importance of ethanol in the domestic and international markets. (June 4, 2009)