Petrobras to Pay $2.1 Billion in Dividends

Brazil’s state-controlled oil producer Petrobras accredited dividends barely beneath expectations amid a commerce battle that has created financial uncertainty and undermined oil costs.

Petroleo Brasileiro SA, as the corporate is formally recognized, can pay 11.72 billion reais ($2.1 billion) in first-quarter dividends, it stated in a submitting Monday. Expectations have been for a $2.2 billion payout, in keeping with a mean of six analyst forecasts reviewed by Bloomberg.

Brazil’s oil big has been showering shareholders with sturdy dividends although the coverage has come beneath political assault and contributed to the downfall of the corporate’s earlier chief govt officer final 12 months. Buyers have been involved that rising capital expenditures, which surpassed steering in 2024, might proceed and restrict future payouts.

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Petrobras is sticking with its plans to increase oil manufacturing, together with different worldwide oil majors together with Exxon Mobil Corp., Chevron Corp. and Shell Plc, regardless of a decline in crude costs throughout April and a call by OPEC+ to crank up output in June. In contrast to US shale operators who want greater than $60 a barrel to cowl prices, Petrobras’s breakeven worth is $28 a barrel.

The Rio de Janeiro-based producer reported adjusted earnings earlier than gadgets of 61.1 billion reais, barely beneath the 62.2 billion-real Bloomberg consensus estimate. Internet revenue was above expectations at 35.2 billion reais, 48.6 % up from the 12 months in the past interval, because of increased oil manufacturing and a extra favorable change price, the corporate stated.

The $4.1 billion in investments was 29 % beneath the earlier quarter when it had “atypical” spending associated to the large Buzios offshore discipline, and the decline might convey aid to the market. Nonetheless, the corporate maintained its spending plan and is pursuing an identical technique to different oil majors together with Exxon Mobil and Chevron, who’re sticking with funding plans regardless of decrease oil costs.

“We proceed dedicated to executing our marketing strategy,” Chief Monetary Officer Fernando Melgarejo stated within the earnings launch, including that the corporate is specializing in deep-water oil fields together with Buzios and Atapu. “These are tasks that generate worth for our shareholders.”

Crude lately tumbled beneath $60 a barrel on fears that the commerce battle might weigh on vitality demand, and after OPEC+ members determined so as to add manufacturing to a market that seems to be over-supplied. Measured optimism on commerce talks between the US and China has helped costs recuperate some floor.

Analysts are optimistic that Petrobras’ manufacturing will speed up because it reaches capability at lately put in offshore manufacturing vessels and provides extra. Two items are anticipated to succeed in capability within the second quarter and a 3rd is anticipated to start operations.

Petrobras is in search of to replenish oil and gasoline reserves to keep away from a manufacturing decline that’s anticipated to begin round 2030. The corporate stated final week that it found “wonderful high quality” oil on the Aram block within the deep-water Santos Basin. It additionally resumed onshore exploration in Brazil’s Bahia state after a six-year halt, with plans to drill 100 wells over the following 5 years.

The state-run oil producer hopes to acquire a allow to begin drilling at a block in deep waters off the coast of the Amazon forest quickly, and convey an finish to a years-long dispute with environmental authorities. Chief Government Officer Magda Chambriard used President Donald Trump‘s slogan “drill child drill” to advocate for the exploration throughout a convention in Houston final week. Petrobras has requested Brazil’s environmental authority to answer a request to maneuver an offshore drilling rig to the environmentally delicate space by Might 15.

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