By Brazil Stock Guide – Brazil’s Executive Management Committee of the Foreign Trade Chamber approved on Thursday (27) a financing mechanism allowing airlines to buy jet fuel with backing from the Export Guarantee Fund (FGE). The measure, first reported by Estadão, opens access to as much as R$2 billion in guaranteed operations and is poised to primarily benefit Azul SA (NYSE: AZUL), which is seeking court approval for its restructuring plan in the United States.
The FGE-backed structure effectively reduces the cost of aviation fuel and provides immediate liquidity support — a feature that Azul had identified as essential to strengthening its argument before the US court. According to Estadão, the company has been relying on this relief to reinforce the credibility of its recovery plan and improve the odds of judicial confirmation.
Discreet approval raised eyebrows among competitors
The decision surprised other players in Brazil’s aviation sector because the item was added discreetly to the Gecex agenda under “other matters,” linked to the creation of a new credit product aimed at civil aviation and energy transition. Before reaching the committee’s agenda, the Export Financing and Guarantee Committee (Cofig) had already approved the new FGE use in May, paving the way for final authorization.
Unlike broader industry demands — such as discussions involving the National Civil Aviation Fund (Fnac) — the FGE request was brought to the government solely by Azul. Rival carriers Gol Linhas Aéreas Inteligentes SA (NYSE: GOL) and Latam Airlines Group SA (OTC: LTMAY), as well as the industry association Abear, did not participate in the talks, according to the original reporting. Azul told the newspaper it would comment at a later time.
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