Petrobras strike could be most damaging in 20 years

An ongoing strike by workers at Brazil’s troubled state oil firm Petrobras could be the most damaging industrial action the firm has faced in 20 years, according to Reuters.

The action began on Sunday in protest at austerity measures being taken by Petrobras, measures which have slashed budgets, investment and manpower.

Late on Wednesday Petrobras’ oil output in Brazil was down by about 140 000 barrels a day, or 6.5 percent on pre-strike levels. That amount was presented in Petrobras’ own securities filing.

The union behind the action, the FUP, claimed the company’s figures were greatly underestimated and stuck by its own estimate that daily output is down by 500,000 barrels daily.

Standard & Poor’s rating agency said on Wednesday that the strike, if not resolved, could seriously hamper the company’s efforts to increase output and reduce its massive debt.

Petrobras is caught in a perfect storm of economic negativity resulting from its own overreach, the plunging price of oil, and the consequences of the bribes-for-contracts scandal that has besieged the company.

Donal Scully

With 28 years experience writing and editing for newspapers in the UK and Hong Kong, Donal is now based in California from where he covers the Americas for Splash as well as ensuring the site is loaded through the Western Hemisphere timezone.
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