Petrobras ups its funding forecast and drops estimate for divestments

Petrobras ups its funding forecast and drops estimate for divestments

Brazil’s troubled state oil firm Petrobras on Tuesday made a bullish forecast on its funding for the year while also reducing its previously declared target for divestments, according to Reuters.

In a statement issued after the company issued disappointing third-quarter earnings, Petrobras said it expects to raise $22bn in funds, much more than the $13bn it forecast earlier this year.

The company, which has been wrestling with a huge bribes-for-inflated-contracts corruption scandal for two years, is the most indebted oil firm in the world.

Despite having vast offshore oil interests, Petrobras has been hit badly by the general long-term downturn in the price of the fossil fuel.

Part of the company’s strategy to reduce its red ink has been divestment of assets – along with staff cuts, budget revisions, cutbacks in investment etc. In its previous forecast, Petrobras had estimated it would divest $8bn this year but now has reset that amount to $7bn.

It does not include the big initial public offering (IPO) planned for fuel distribution arm BR Distribuidora.

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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