After downturn in the stock market, Petrobras shows good recovery

Press Release (ePRNews.com) - SAO PAULO, Brazil - Nov 09, 2016 - One of Brazil’s most important state-owned companies, Petrobras produces daily more than 2.7 million barrels of oil and another 2 million barrels of oil per day. Present in more than 19 countries, its economic importance is significant, especially in Latin America.

Its main activities in the petroleum sector are exploration and production of oil and natural gas; distribution and transportation; and petrochemical production, fertilizers and biofuels. In order to achieve excellence, the company has a structure that includes 3 fertilizer plants, 5 biodiesel plants, 9 ethanol plants, 13 refineries, 20 thermoelectric plants and 122 platforms.

As one of the largest oil companies in the Americas, Petrobras assets have great demand in the Financial Market. Only in March this year, its stocks traded more than US$ 212 million on the Bovespa, the main stock exchange in Brazil. These millions corresponded to 8.5% of the total traded on the Brazilian stock exchange that month.

Petrobras’ stocks show great recovery

Despite its production potential, the Brazilian company experienced difficult times, especially in 2015. Last year, the dollar surpassed the R$ 4 mark. As a result, the company saw its indebtedness grow, adding losses of more than US$ 1 billion. During this bad phase, the value of the Petrobras stocks has dropped by 40% in 2015.

In addition to the decline that impacted the Brazilian economy, the factor that most influenced Petrobras’ performance was the corruption allegation involving some of its leaders. Investors around the world turned their attention to the oil company after the investigation began and the evolution of the process remains in the focus of the market since the results can directly affect the price of oil assets.

The year 2016 began to perpetuate a season of bad performance, as in January PETR4 stocks reached a low record. The progress of Dilma Rousseff’s impeachment process also caused a sharp oscillation in Petrobras stock prices. In just one day in the month of May, when the House of Representatives voted in favor of impeachment, there was a variation of 14%.

In the following months, the fall of the dollar in relation the Real allowed a recovery after a period of sharp decline. Currently, in the accumulated of the year, the valuation of PETR4 shares already reaches more than 135%. Since the lowest price of the year, on January 26, assets were up more than 280%.

Brazilian company focus on pre-salt

One of the bets of the Brazilian oil company to help its recovery path is the exploration of the pre-salt layer. Since 2007, the project has become the focus of the company’s investments. The estimates released by Petrobras intend to invest until 2021 more than US$ 60 billion in the production and exploration of oil and natural gas.

The pre-salt layer in the Brazilian coast has accumulations of oil of great quality and high commercial value. Therefore, Petrobras has strong expectations regarding the strengthening of its role in this segment internationally.

Since the beginning of pre-salt exploration, the company’s operations have evolved rapidly. Daily production increased 50 times, as in 2010 there were 40 thousand barrels of oil produced daily and, on the other hand, the mark of 2.7 million barrels per day was already reached in 2016.

A novelty in the Brazilian legislation brought new spirit and some concerns for Petrobras. In October of this year, a bill was approved that exempts the state-owned company from operating exclusively in the exploration fields. According to the project, the oil company is no longer required to participate in all the consortia and can decide which fields it is interested in exploring.

To learn more about Petrobras and the Brazilian financial market, visit: http://www.tororadar.com.br/blog/bovespa-the-brazilian-st…

Source : Toro Radar
Business Info :
Toro Radar

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CATEGORIES : Investments
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