Senate President Davi Alcolumbre extended the validity of Provisional Measure 1358/2026 by 60 days [1] on Monday to maintain fuel subsidies in Brazil [2].

The move is intended to prevent sharp price increases for gasoline and diesel at the pump. This intervention comes as the Brazilian government seeks to shield the domestic economy from volatility caused by the ongoing war between the U.S. and Iran [3, 4].

Under the terms of the measure, the government provides subsidies to the fuel sector to keep consumer prices stable [1]. The extension ensures that the pricing mechanisms remain in place while the legislature continues to analyze the long-term viability of the measure [2].

Alcolumbre, who also serves as the president of the National Congress, signed the extension in Brasília [1]. The measure acts as a financial buffer against global oil market fluctuations, a necessity driven by the geopolitical instability in the Middle East [3, 4].

Without the extension, the subsidies would have expired, potentially leading to an immediate spike in transport and logistics costs across the country. The 60-day window provides the government and lawmakers more time to negotiate a permanent solution, or a different fiscal approach to fuel pricing [2].

Government officials said the measure was intended to specifically contain the rise of gasoline prices [3]. The current extension allows the administration to maintain a level of price control while the global energy market remains unpredictable due to the conflict [4].

“The measure acts as a financial buffer against global oil market fluctuations.”

By extending these subsidies, Brazil is prioritizing short-term inflation control over immediate fiscal austerity. The reliance on Provisional Measure 1358/2026 highlights the vulnerability of Brazil's internal market to external geopolitical shocks, specifically the U.S.-Iran conflict, and suggests that the government views fuel price stability as essential for preventing a broader economic slowdown.