Debate was removed from the agenda due to the proximity of the analysis in the Court; decision will define division of the fiscal impact of oil between States
O (Consensual Conflict Resolution Center) of the canceled on Thursday (April 30, 2026) the conciliation hearing that would discuss the redistribution of oil royalties. The meeting, which was scheduled for May 5th, was removed from the schedule. The justification is the proximity to the judgment on the merits of the matter in the Court’s plenary, scheduled for the following day.
The decision was signed by judge Álvaro Ricardo de Souza Cruz, the same judge who had previously promoted the attempt at a negotiated solution. The judgment deals with the financial compensation of oil exploration companies to the Union and the consequent distribution to States and municipalities.
The hearing would serve to try to formalize agreements based on proposals presented by Codesul (Southern Development and Integration Council), the CNM (National Confederation of Municipalities) and the State of Espírito Santo. The process already has 33 technical meetings that indicated the feasibility of reaching a consensus before the suspension.
war cape
Divergence of judgment is the Law which modified the criteria for and for special participation in oil and gas exploration. The rule expanded the share allocated to non-producing states and municipalities, but has been suspended since 2013 due to an injunction granted by minister Cármen Lúcia.
Currently, the CNM and a group of 19 non-oil and gas producing states are articulating the validation of the law, while producing states – such as Rio de Janeiro, São Paulo and Espírito Santo – are fighting to maintain the current model under the argument of fiscal risk.
FLUMINENSE MOVEMENT
The OAB-RJ (Brazilian Bar Association in the State of Rio) requested the Supreme Court to include a technical note from Firjan (Federation of Industries of the State of Rio de Janeiro) in the process.
The document details that, if the law had been in force between 2020 and 2025, the State of Rio would have failed to collect R$48.3 billion, while Rio’s city halls would have lost another R$68.7 billion in the same period. Read the document [PDF – 50MB].
The federation highlights that royalties make up 21.8% of Rio de Janeiro’s total revenue and that the change would concentrate the environmental and social costs of extraction on producers without due financial compensation.
On Thursday (April 30), the acting governor of Rio de Janeiro, judge Ricardo Couto de Castro, went to Brasília to discuss the issue. He met with the president (PT) and STF minister Luiz Fux. The objective of the meetings was to reinforce concern about the severe economic impact that an unfavorable decision in the Court’s plenary could cause to the State.
