Brazil's antitrust body CADE has issued a decree to ensure that a three-company consortium led by the state-run oil company Petroleo Brasileiro SA does not create an energy monopoly in Latin America's largest country.

The consortium, including Brazilian petrochemical company Braskem SA and fuel and petrochemical company Ultrapar Participacoes SA, bought Grupo Ipiranga's fuel distribution, petrochemical and oil refining assets in mid-March.

Late Tuesday, CADE issued a decree in response to a request from the finance and justice ministries guaranteeing that the US$4 billion deal can be reversed if the operation is found to have broken antitrust rules.

It aims to "guarantee that any eventual restriction imposed by antitrust bodies will be effective, thus protecting the final consumer and guarantee that the deal is completed without causing financial market volatility," the ministries said in a joint statement.

The ministries' antitrust divisions said they were concerned about Petrobras taking over gasolene stations in the north, northeast and centre-west, which would raise its market share to 50 per cent in some cities.

They are also concerned that Ultrapar could take over Ipiranga's fuel distribution operations in the south and southeast and become Petrobras' main competitor in the region, which they say could create opportunities for collusion like price fixing.

AP