Oil Slump Pushes Petrobras To Review Brazil Onshore Operations: ‘We Haven’t Yet Decided What To Do’

Brazil’s Petrobras is reportedly weighing the sale of its onshore operations in the northeastern Bahia state amid low oil prices.

Petrobras CEO Magda Chambriard said that oil and gas production on the so-called Polo Bahia Terra is too expensive, according to a Bloomberg report.

“When oil is at $100 a barrel, it makes more sense than at $65 a barrel,” she reportedly said before adding, “We haven’t yet decided what to do: whether to keep it, outsource the operation, or simply pass on the asset.” The Bahia Terra cluster’s output is around 12,400 barrels of oil equivalent a day, Bloomberg reported, citing Brazil’s oil regulator.

Oil prices have been pressured this year due to uncertainty over global demand, stemming from tariff concerns and worries of OPEC+ oversupply. Analysts at Goldman Sachs have projected that oil prices will average below $60 per barrel during the fourth quarter and could dip even further due to tepid demand.

Late last week, OPEC+ raised August production levels to a higher-than-expected 548,000 barrels per day, piling further pressure on oil prices, which have lost the gains seen during the conflict between Israel and Iran. Retail sentiment about Petrobras on Stocktwits was in the ‘bearish’ territory.

Last week, the company said it would invest 26 billion reais ($4.80 billion) in integrating its Reduc refinery and the Boaventura energy complex in Rio de Janeiro state. In May, the company said it would continue with its capital investments plan despite a pullback in oil prices.

Petrobras U.S. shares have gained about 2.4% this year compared with 0.5% gains in the United States Oil Fund (USO).

Also See: Canada Premier Carney Signals Federal Support For New Oil Pipeline To West Coast: ‘My Government Will Do Everything’

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