RIO DE JANEIRO, Feb 2 - Brazil's state-controlled oil producer Petroleo Brasileiro SA is considering selling its remaining stake in gas station chain BR Distribuidora if its stock recovers to 26 reais a share, three people with knowledge of the information said.

For the first time since the COVID-19 pandemic stalled the sale process, Petrobras has agreed on a target stock price range for the sale of its 37.5% stake, worth 10.3 billion reais ($1.9 billion), considering its current market price.

The share sale by Petrobras, as the producer is known, would effectively end government participation over the fuel distributor, which would become a corporation with no major controlling stake holder.

A share sale around 25 reais apiece has not been ruled out, said two of the people, who requested anonymity because the sale discussions are confidential. While executives have agreed on a range at which they would sell, no hard target has been set. Petrobras and BR Distribuidora declined to comment.

BR Distribuidora stocks recently peaked at 24.33 reais, in a 16.4% intraday rise on Jan. 26, after the board announced Wilson Ferreira Jr. would take the chief executive post at Latin America's largest gas station chain after leaving as CEO of state-run power company Eletrobras.

Petrobras' move to unload its BR stake is part of a wider government effort to have the oil company focus on deep-water production and open Brazil's oil-related markets to private players - from fuels, to natural gas and fertilizing plants.

Petrobras Chief Executive Roberto Castello Branco said last week during a webinar that he was awaiting an improvement in price conditions to resume the share sale process, which stalled early during the COVID-19 pandemic. BR shares hit a year high of 29.93 in February 2020 before losing about half their value the next month. This would be the third major share sale by Petrobras of BR Distribuidora, which was fully state controlled until three years ago. Shares were sold at 15 reais apiece in its initial public offering, in December 2017, when Petrobras sold a 29% stake.

BR was effectively privatized in 2019 through a follow-on operation, with shares sold at 24.50 reais. Petrobras then raised 9.63 billion reais https://www.reuters.com/article/us-petrobras-distri-privatization-idUSKCN1UI1YU ($2.55 billion) by reducing its position to 37.5% from 71%. ($1 = 5.3554 reais)

(Reporting by Sabrina Valle; Editing by Lisa Shumaker)