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Mr Serra's advisers propose either to restore price controls or to force Petrobras to sell assets.
He wanted to restore price levels to what they had been in 1926.
Such estimates suggest that regulators should withhold at least 700 million E.U.A.'s, and probably more, to restore price tension.
A withholding of 1.4 billion E.U.A.'s would certainly help restore price tension, as a renewed E.U.A. shortage would force power generators to switch from burning high-carbon coal to natural gas, implying a carbon price of about €21, given present coal and natural gas prices.
And even if it doesn't act in time, and inflation expectations start to get out of line, I am confident that the Fed would tighten monetary policy quickly and aggressively enough to restore price stability and maintain its credibility on inflation.
But the more that people expect higher inflation to persist and act on that view when they set prices and negotiate wages the harder it will be for the bank to restore price stability without driving the economy into recession by raising interest rates.
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The industry is in need of a great vintage to help restore prices, which have fallen steadily since 2000.
In addition, any market with inflated prices induced by a horizontal agreement will rapidly attract new entrants, and they can easily restore prices to the competitive level.
With strong attendance, Disney's parks division was able to restore prices for tickets and hotel rooms to near-normal levels.
OPEC called on other oil-producing countries to "contribute to efforts to restore prices to reasonable levels, and eliminate harmful and unnecessary fluctuations".
"But you have already taken out a lot of capacity and that is going to help restore pricing power in the industry for the first time in more than 10 years".
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com