Category: Brazil

SÃO PAULO—Some big international investors have been selling shares in Brazil’s state-run oil company Petróleo Brasileiro SA, or Petrobras, as the company faces the biggest crisis of its history amid corruption allegations. Investors including Soros Fund Management LLC, which invests for billionaire investor George Soros and his family; BlackRock Fund Advisors; and Fidelity Management Research Co., cut their stakes in the Brazilian company in the fourth quarter, when the corruption scandal gained force. “Big international investors prefer to stay away from Petrobras because the uncertainty surrounding the company is huge. So they’ve opted to take a conservative path until they see a clearer scenario for the company,” said João Pedro Brugger, a portfolio manager at Leme Investimentos, based in Florianopolis. Mr. Brugger said his company owns shares in Petrobras as part of a portfolio matching Brazil’s Ibovespa stocks index. Soros slashed its stake in Petrobras by 60% to 2 […]

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(Bloomberg) — Brazilians are paying more to fill their gas tanks even as oil’s 49 percent rout in the past year drives down prices from New York to Tokyo. Gasoline in Sao Paulo climbed 9.9 percent in the past three months to 3.26 reais a liter, or about $4.50 a gallon, at the start of February, the most recent figures available, according to data compiled by Bloomberg. The price fell 31 percent to $2.06 a gallon in the U.S. and 23 percent to $5.51 in Europe in the period. “We’re swimming against the tide,” Pedro Paulo Silveira, chief economist at brokerage TOV Corretora, said in a telephone interview from Sao Paulo. “The fact is that consumers are in a complicated situation in Brazil.” Brazilian consumers and companies can expect to pay more for all energy this year, from natural gas to electricity. Petroleo Brasileiro SA, the state-run oil producer […]

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The board of Petroleos Mexicanos (Pemex) has approved a $4-billion budget reduction for 2015, an 11.5% decrease compared with the previous expenditure program authorized by Mexico’s Congress. Pemex says the cuts, which come amid lower oil prices , are imperative in achieving financial targets set by Congress. Two thirds of the company’s $36.3 billion budget—$24.6 billion—will be allocated toward the company’s investment plans. The remaining one third will go toward operating activities and meeting labor and pension obligations. Pemex says its budget formulation process considered a $79/bbl average price for the Mexican crude oil export basket to estimate annual revenues and to set a corresponding ceiling on expenditures. Deferred spending for downstream activities includes refinery revamps and clean fuels projects involving ultra-low sulfur gasoline and diesel ( OGJ Online, Feb. 18, 2015 ). The board has instructed management to meet with contractors and renegotiate long-term deals that were made […]

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SÃO PAULO, Brazil — Endowed with the Amazon and other mighty rivers , an array of huge dams and one-eighth of the world’s fresh water, Brazil is sometimes called the “ Saudi Arabia of water ,” so rich in the coveted resource that some liken it to living above a sea of oil. But in Brazil’s largest and wealthiest city, a more dystopian situation is unfolding: the taps are starting to run dry. As southeast Brazil grapples with its worst drought in nearly a century, a problem worsened by polluted rivers, deforestation and population growth, the largest reservoir system serving São Paulo is near depletion. Many residents are already enduring sporadic water cutoffs, some going days without it. Officials say that drastic rationing may be needed, with water service provided only two days a week. Behind closed doors, the views are grimmer. In a meeting recorded secretly and leaked […]

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By Anna Molin Norway’s BW Offhore Ltd. (BWO.OS) Thursday said five people were killed and four are still missing following an explosion on a Petroleo Brasileiro SA vessel off the coast of southeastern Brazil. The offshore production operator and owner said all remaining crew have been accounted for and receiving medical care where needed, with two in critical condition. There were a total of 74 people onboard the platform, operated for state-run oil company Petrobras by BW Offshore. Production has been stopped and the Cidade de São Mateus FPSO unit has been shut down, BW Offshore said. For safety reasons, all employees have been taken off the unit, it added. The accident occurred shortly after midday Wednesday about 75 miles off the coast of Espirito Santo state, north of Rio de Janeiro. "This is a tragic day, and our primary focus now is on the crew and their families. […]

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(Bloomberg) — Petroleo Brasileiro SA halted drilling at its largest oil discovery in deep waters, two people with knowledge of the matter said, underscoring the technical challenges facing the company’s new management team. An unplanned procedure to retrieve equipment stopped work for more than a week at a well in Libra, the people said, asking not to be named because it hasn’t been made public. Rio de Janeiro-based Petrobras didn’t immediately respond to a request for comment on the incident and if it had been resolved. Commercial production is expected to start in 2020. While Petrobras expanded output to a record in December at the so-called pre-salt region that holds Brazil’s largest deposits, it has also run into drilling disruptions in the past. In 2010, it abandoned the first well it started at Libra, citing mechanical issues. In 2011, it briefly halted production at the Sapinhoa field in the […]

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BUENOS AIRES — The leadership of Petrobras, the Brazilian national oil giant grappling with a sprawling graft scandal, abruptly resigned on Wednesday amid accusations of a bribery scheme involving kickbacks to President Dilma Rousseff ’s governing Workers Party and its allies. The shake-up included the departure of Maria das Graças Foster, the chief executive handpicked in 2012 by Ms. Rousseff, after months of tumult at the state-controlled oil company. Skepticism had grown over Ms. Foster’s capacity to deal with the scandal at a time when low oil prices are also forcing the company to slash spending on costly projects. Ms. Rousseff had recently decided to replace Ms. Foster and other senior executives this month, according to news reports, fueling a surge in Petrobras shares. The newspaper O Globo reported on Wednesday that Ms. Foster insisted on resigning after meeting on Tuesday with the president in Brasília. Reflecting a low […]

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Maria das Graças Foster Maria das Graças Foster , the embattled head of Petrobras , is set to step down to help resolve a crippling corruption scandal at the Brazilian state-owned oil company, sources at the presidential palace in Brasília said.  The sources said they were unable to provide an exact timetable for her departure but indicated it could be as early as the end of this month. President Dilma Rousseff was reported to have met Ms Graças Foster on Tuesday.  A person familiar with the matter said Ms Graças Foster’s position had become “untenable” at Petrobras, which is at the centre of allegations that executives collaborated with politicians, contractors and black market money dealers to cream billions of dollars from the company’s projects in bribes and kickbacks.  A spokesperson for the presidential palace refused to comment on Tuesday.   A close friend of Ms Rousseff, Ms Graças Foster […]

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Sao Paulo state has received only one third of the rainfall expected in the wet season Related Stories Brazil’s Environment Minister Izabella Teixeira has said the country’s three most populous states are experiencing their worst drought since 1930. The states of Sao Paulo, Rio de Janeiro and Minas Gerais must save water, she said after an emergency meeting in the capital, Brasilia. Ms Teixeira described the water crisis as "delicate" and "worrying". Industry and agriculture are expected to be affected, further damaging Brazil’s troubled economy. The drought is also having an impact on energy supplies, with reduced generation from hydroelectric dams. ‘Poor planning’ The BBC’s Julia Carneiro in Rio de Janeiro says Brazil is supposed to be in the middle of its rainy season but there has been scant rainfall in the south-east and the drought shows no sign of abating. The crisis comes at a time of high […]

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