March 19, 2026 [Reuters]- Brazilian state-run oil firm Petrobras is operating ​six of its 11 domestic refineries beyond installed capacity to produce ‌fuel locally amid a spike in prices caused by the U.S.-Israeli war on Iran, an executive told Reuters on Wednesday.

William Franca, Petrobras’ head of industrial processes and products, said ​the company has made investments that enable the refineries to exceed ​their stated capacities.

“We have the capacity to operate at a ⁠high level during this wartime period to increase the supply of diesel ​in the country,” Franca said.

He added the refineries are still following all rules ​and production norms and they are operating “well” for now.

Refinery Abreu e Lima in Brazil’s northeastern Pernambuco state, is operating at 109% of capacity, according to a document seen by Reuters.

CEO ​Magda Chambriard told journalists earlier that Petrobras’ refineries as a whole were ​expected to operate at around 98.5% of their capacity in April, up from around 97% ‌last ⁠week and 91% last year.

The effort comes as Petrobras reviews scenarios for the Iran conflict, which is lasting longer than the firm expected, Chambriard said earlier in the day, putting pressure on local diesel prices for consumers.

Diesel prices have ​become a major ​source of concern ⁠for Brazil’s President Luiz Inacio Lula da Silva, who is running for reelection this year.

In a bid to soften ​the impact of higher global oil prices, Lula scrapped taxes on ​diesel ⁠last week, and Brazil’s oil regulator launched an operation to combat fuel price gouging.

While most of the diesel Brazil consumes is produced locally by Petrobras, about 25% ⁠of ​the fuel is imported, leaving the country vulnerable ​to higher oil prices abroad since the war began in the Middle East.