Why Brazilian Oil Company Petrobras Stock Is Higher Today

Zinger Key Points
  • Petrobras' new CEO, Magda Chambriard, emphasizes the national importance of Brazil's Equatorial Margin for oil exploration.
  • Petrobras has awaited a drilling license for a year, with Chambriard seeking broader discussion beyond a single agency's decision.

Petroleo Brasileiro S.A. PBR Petrobras‘ new chief executive officer (CEO), Magda Chambriard, reportedly stated that a basin in Brazil’s Equatorial Margin was a matter of “national interest.”

Brazil’s Equatorial Margin is an environmentally sensitive offshore prospect seen as the country’s most promising frontier for oil exploration.

On Friday, Petrobras appointed Magda Chambriard as a member of the Board of Directors and elected her as the company’s new CEO. She replaced prior CEO Jean Paul Prattes, who had resigned amid a dispute over dividend payments.

Chambriard stated that replenishing oil reserves was a priority for Petrobras and that exploring the Equatorial Margin was part of that effort, reported Reuters.

She disclosed that she wanted to escalate talks about the region near Guyana to the National Council of Energy Policy (CNPE), which advises the president, per the report.

Notably, Petrobras had been waiting for about a year for Brazil’s environmental agency Ibama to rule on an appeal after the agency denied it the license to drill in the area, which is about 175 km (109 miles) off the coast of the state of Amapa, in the Amazon region. 

Chambriard said discussions on whether or not to explore the area should not be left to one single government body.

This month, Petrobras reported Q1 FY24 sales of $23.77 billion (-11.2% Y/Y), missing the consensus of $24.35 billion, and earnings per ADS of $0.74 missed the consensus of $0.84.

Price Action: PBR shares are up 2.90% at $15.25 at the last check Tuesday.

Photo via Shutterstock

Market News and Data brought to you by Benzinga APIs
Posted In: EquitiesLarge CapNewsManagementMoversMediaBriefsStories That Matterwhy it's moving
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!