Petrobras Books 38% Drop in Q1 Profit

Petrobras reported a net profit of some $4.63 billion for the first quarter of the year, which was 38% lower than its first-quarter 2023 result.

The figure was also substantially lower than what analysts expected the company would book, Reuters noted in a report. It added that Petrobras would distribute dividends amounting to $2.61 billion, which was also lower than what analysts had predicted.

Petrobras also reported a 15% decline in revenues during the period and a 4.6% decline in oil, gas, and fuel sales.

The first-quarter report follows a disappointing fourth-quarter 2023 presentation in March when company shareholders learned they were going to be getting only a minimum dividend from Petrobras for a while.

The reason for that decision was generating funds for shifting the business of the company away from oil and gas and into things like wind and solar, chief executive Jean Paul Prates said.

In February, Prates told Bloomberg that his plans were to have 50% of the company’s revenues come from wind, solar, and renewable fuels within ten years, adding that he believed shareholders would understand.

It appears they did not, because the March dividend announcement was followed by its stock crashing, wiping out $14 billion in company value in a single day.

Interestingly, however, the transition plans of the company’s CEO follow investment plans publicized last November that focus overwhelmingly on Petrobras’ core business.

Petrobras’s next five-year plan featured a 31% increase in planned investments to $102 billion. Of that, 72% was earmarked for oil and gas investment with a view to boosting the company’s oil and gas output to 3.2 million barrels of oil equivalent daily from 2.8 million barrels of oil equivalent currently.

Then, in February, Petrobras said it eyed investments of about $100 billion in offshore oil production growth over the next six years.

By Irina Slav for Oilprice.com

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