Category: Brazil

Photo President Dilma Rousseff speaking in Brasília. Her approval rating has plunged since her re-election to a second term last year. Credit Ueslei Marcelino/Reuters RIO DE JANEIRO — The president is battling calls for her impeachment. The speaker of Brazil ’s lower house is grappling with accusations that he pocketed a $5 million bribe. The former treasurer of the governing Workers Party is in jail. Even former President Luiz Inácio Lula da Silva, Brazil ’s most towering political leader in recent decades, is under the cloud of an investigation into claims of influence peddling. A sweeping anticorruption crusade in Brazil is ensnaring one major political figure after another, throwing the country into upheaval at a time when the national mood is souring and the economy is reeling from a painful downturn. Large segments of the political establishment are maneuvering against President Dilma Rousseff , a rebellion led by some […]

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Photo Comperj, a giant refinery and petrochemical complex built by the state oil company, Petrobras, in Itaboraí, Brazil. The unfinished project was originally planned to cost $6.1 billion, but a state audit put the price closer to $50 billion. Credit Andre Vieira for The New York Times Alberto Youssef, a convicted money launderer and former bon vivant, sat in a Brazilian jail cell in March of last year, getting ready to tell his lawyers a story. It was about an elaborate bribery scheme involving Petrobras , the government-controlled oil giant. He opened with a dire prediction. “Guys,” Mr. Youssef said, “if I speak, the republic is going to fall.” To those lawyers, Tracy Reinaldet and Adriano Bretas, who recently recounted the conversation, this sounded a tad melodramatic. But then Mr. Youssef took a piece of paper and started writing the names of participants in what would soon become known […]

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Brazilian oil ambitions may be larger than reality, a survey from British energy consultant group Douglas-Westwood finds. File Photo by UPI/Shutterstock/project1photography LONDON, July 6 (UPI) — British energy consultant Douglas-Westwood said the prospects of turning 16 billion barrels of potential Brazilian barrels of oil into reality may be dubious. Douglas-Westwood said it was questioning whether Brazilian energy company Petrobras can turn ambition into reality in deepwater prospects. "Brazil’s huge deepwater potential remains constrained with Petrobras having to revise their production target for 2020, which now forecasts domestic oil output to increase to 2.8 million barrels per day – 40 percent lower than its projection 12 months ago," a forecast published Monday read. Petrobras last week published a management plan through 2019 that reflects the downturn in crude oil prices. The Brazilian company cut overall spending plans by 40 percent, but allocated 84 percent of that to exploration and production, […]

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Petroleo Brasileiro SA, the world’s most-indebted oil company, led losses in the Ibovespa as oil slumped on concern supplies are too high. Shares of Petrobras extended a three-day plunge as crude sank 4.2 percent to $56.96 a barrel after data showing U.S. stockpiles rose for the first time in nine weeks and OPEC production increased. The state-run company has said that investments in oil and gas offshore production are economically viable with the commodity above $45. “There are too many uncertainties regarding the profitability of Petrobras’s investments as crude falls,” Eduardo Velho, the chief economist at investment firm INVX Global Partners, said in a phone interview from Sao Paulo. The Ibovespa retreated 0.6 percent to 52,757.54 at the close of trading in Sao Paulo, bringing this week’s decline to 2.3 percent. The gauge had posted the best first half of any year since 2009. Brazilian shares swung between gains […]

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Brazil opened the door for a debate on allowing foreign oil companies to operate in a region holding some of the world’s biggest discoveries this century as the state-owned producer struggles to emerge from a graft scandal. Energy Minister Eduardo Braga said for the first time Wednesday that Petroleo Brasileiro SA shouldn’t be forced to operate all fields in the so-called pre-salt region, while adding that now isn’t the time to make changes. “The production-sharing regime needs to be reviewed under the logic that Petrobras should always be the operator when it is in its interest, not an obligation, because we can’t require a company if it doesn’t have the physical and financial capacity,” Braga told lawmakers in Brasilia. “For now, it isn’t the moment or the topic to debate, because I think we are still starting the debate of an area that is extremely voluminous.” The comments come […]

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Brazilian President Dilma Rousseff. Photographer: Evaristo SA/AFP via Getty Images (Bloomberg) — From pot-banging on the streets to defeats in Congress, Brazil’s President Dilma Rousseff hasn’t had a good week defending austerity measures she hopes will fix a broken economy. And it’s about to get worse. Brazilians in several cities plan to demonstrate on Sunday against corruption and growing economic hardship, demanding Rousseff’s impeachment. More than a quarter of a million people signed up on social media to participate. On Friday, pro-government unions intend to protest labor and pension cuts. Brazil is one of several Latin American countries where a cocktail of corruption scandals, slowing growth, falling currencies and accelerating inflation is eroding leaders’ popularity as a decade-long commodities boom comes to an end, said Joao Augusto de Castro Neves, Latin America analyst at Eurasia Group. It’s a hard time for Rousseff to be pushing through an austerity package. […]

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ENLARGE Rio de Janeiro state Gov. Luiz Fernando Pezão will be investigated for money laundering and public-administration violations. Photo: Felipe Dana/Associated Press RIO DE JANEIRO—A Brazilian high-court judge cleared federal prosecutors Thursday to investigate the current governor and a former governor of Rio de Janeiro state, as a probe into alleged corruption surrounding state oil company Petróleo Brasileiro SA widened. Current Gov. Luiz Fernando Pezão and his predecessor, Sérgio Cabral, will be investigated for money laundering and public-administration violations. Federal prosecutors suspect them of soliciting and receiving 30 million Brazilian reais ($9.5 million) in 2010 from construction firms contracted by Petrobras to build a large refinery in Rio state. Petrobras’s former refining director, Paulo Roberto Costa, detailed the alleged payments last year as part of a cooperation agreement with prosecutors. But because of special rules guiding the prosecution of public officials, Brazil’s vice attorney general had to request authorization […]

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The Petrobras logo is seen at a refinery in Cubatao, Brazil, on Tuesday. ENLARGE Photo: Reuters SÃO PAULO—A decision by a major credit-rating firm to downgrade to junk status the debt of Petróleo Brasileiro SA is stoking fears that Brazil’s sovereign rating could be next. Moody’s Investors Service late Tuesday slashed the debt of the company, known as Petrobras, two notches to Ba2, two steps below investment grade, on continued concern about the fallout from a corruption scandal and the state-run oil giant’s ability to pay down about $135 billion in debt. The downgrade was the third by Moody’s since October. Still, the size and timing of Tuesday’s cut surprised some analysts and sent the country’s leaders into a defensive crouch. Brazil’s largest company, Petrobras plays an outsize role in the nation’s economy, which is flirting with recession. Petrobras’s newfound junk status is “an unequivocal blow” to the administration […]

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(Bloomberg) — Sete Brasil Participacoes SA, the company founded to lease oil rigs to Petroleo Brasileiro SA, said it’s considering legal measures against a shipyard that pulled out of a $6 billion deal to build drillships. Estaleiro Atlantico Sul, or EAS, owned by Grupo Camargo Correa and Grupo Queiroz Galvao, notified the company that it’s canceling the contract, Rio de Janeiro-based Sete Brasil said today in an e-mailed statement. Sete Brasil didn’t disclose any further details from the cancellation letter. O Estado de S. Paulo newspaper reported today that missed payments from Sete spurred the decision. The cancellation is another setback for Sete Brasil after a former executive and Petrobras manager said in testimony made public Feb. 5 that he took bribes from shipyards, allegedly including EAS, in exchange for contracts. Numerous phone calls and e-mails to EAS for comment weren’t answered. The accusation of corruption increases concern that […]

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