Petrobras’ Q1 earnings dip 38% due to decreased diesel sales, currency depreciation

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Brazilian state-controlled oil giant Petrobras announced a decline in its quarterly earnings, attributing the slump to decreased revenue from diesel sales in the domestic market and exports.

According to the latest financial report, Petrobras recorded a net profit of 23.7 billion reais (US$4.6 billion) in the first quarter of 2024, marking a 38% decrease compared to the same period last year when it stood at 38.2 billion reais. Net revenues also declined, dropping 15% from 139.1 billion reais to 117.7 billion reais.

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The company highlighted that the results were further affected by the depreciation of the Brazilian real against the U.S. dollar. However, Petrobras emphasized that these effects were partly mitigated by a reduction in operating expenses and income tax.

In terms of production, Petrobras experienced a 5.3% decrease in oil production during the first quarter of 2024 compared to the previous quarter, amounting to 2.236 million barrels per day (b/d). Notably, output in the pre-salt province saw a 4.1% decline to 1.857 million b/d, primarily due to increased losses from stoppages and maintenance activities.

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Despite these challenges, Petrobras said it continued its efforts to increase production, particularly from the Sepetiba, Anita Garibaldi, and Anna Nery floating production, storage, and offloading vessels. Additionally, the company brought online 19 new wells from complementary projects in the Campos and Santos basins. Total hydrocarbon production witnessed a 5.4% decrease to 2.776 million barrels of oil equivalent per day during the period under review.

In terms of investments, Petrobras allocated approximately US$3 billion in the first quarter of 2024, with the majority, US$2.5 billion, directed towards exploration and production activities. Furthermore, the company managed to reduce its net debt by 2.4% from the previous quarter to $43.6 billion reis.

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