Brazil's state-owned integrated oil and gas company $PETR3 (+1,29%)
$PETR4 (+0,43%) has increased jet fuel prices by 7% with effect from January 1, 2025. This price adjustment will affect key markets such as Betim, Guarulhos and Duque de Caxias, as well as other important air transportation hubs throughout Brazil. This move underscores Petrobras' ongoing efforts to align its fuel prices with global market dynamics, including volatile oil prices and exchange rate fluctuations.

Why Petrobras is raising jet fuel prices

Petrobras' decision to increase jet fuel prices is part of the company's strategic response to changing global economic conditions. The company regularly adjusts its fuel prices, often on a monthly basis, taking into account important factors such as global oil price trends, the value of the Brazilian real against the US dollar and operating costs. These adjustments are essential for PBR to maintain its profitability and ensure the continued functioning of the Brazilian energy market.

In recent months, global oil prices have been subject to significant fluctuations due to various factors such as geopolitical tensions, global imbalances between supply and demand and shifts in the financial markets. As a major player in the energy sector, PBR must adapt to these changes in order to maintain its competitive advantage and sustain the company's operations, especially in the highly price-sensitive aviation industry.

Impact on distributors and airlines

The price increase will be felt most by fuel distributors who purchase fuel directly from Petrobras and pass it on to Brazilian airlines. Although consumers will not feel the immediate impact of the price change, it is likely that airlines will pass on the increased fuel costs to passengers, especially on domestic flights.

As the Brazilian aviation industry continues to recover from the effects of the COVID-19 pandemic, this price increase could put additional pressure on already tight margins. Airlines struggling with rising fuel prices and recovering demand could feel further pressure on their profitability. Jet fuel is one of the two most important operating costs in the aviation industry and any price increase has a direct impact on the industry's profitability and pricing strategies.

Strategic price adjustments by Petrobras

PBR is known for its regular fuel price adjustments that help the company keep pace with market conditions. These adjustments help mitigate the risk of significant price differentials between production costs and retail prices, which could affect the company's financial stability. PBR could incur significant losses if the company does not respond to global oil price developments.

Brazil's real exchange rate is another important factor in Petrobras' pricing strategy. If the real weakens against the US dollar, the cost of crude oil, which is priced in dollars, rises. This leads to an increase in the cost of refined products such as jet fuel. PBR therefore adjusts its prices to take account of these fluctuations and maintain the company's financial viability.

The Brazilian energy company Petróleo Brasileiro S.A. $PETR3 (+1,29%)
$PETR4 (+0,43%) has commissioned a system for reducing atmospheric emissions (SNOX) at the Abreu e Lima refinery (RNEST) in the city of Ipojuca in the state of Pernambuco.

Petrobras stated in a press release that the new plant will allow the refinery to increase its current processing by 27,000 barrels per day (bpd) in accordance with the emission limits set by the local environmental authority.

According to Petrobras, SNOX is the first refinery emissions reduction plant in Brazil and the Americas. SNOX can convert sulphur oxide (SOx) and nitrogen oxide (NOx) into sulphuric acid. Petrobras is thus adding a new product to the company's portfolio. According to the company, the acid produced is an important raw material for the treatment and production of drinking water, among other things.

While SOx emissions are reduced, the plant generates steam energy that is used in refinery operations, leading to a reduction in gas consumption for energy generation and improving the overall energy efficiency of RNEST, according to Petrobras.

Petrobras added that preparations are underway to begin expansion work on Train 1. This will increase the refinery's capacity by 15,000 bpd, improve the flow of light products and increase the processing capacity for pre-salt oil. The expansion is expected to be completed in the first quarter of 2025.

Petrobras also announced that it will begin the procurement process for work on Train 2, which is expected to increase RNEST's capacity by a total of 130,000 bpd.

Of all Brazilian refineries, RNEST has the highest conversion rate of crude oil to diesel at 70 percent. Once the RNEST projects (SNOX, Revamp Train 1 and Train 2) are completed, the plant will be able to process 260,000 barrels of oil per day, which will lead to an increase in national S-10 diesel production of around 13 million liters per day, according to Petrobras.

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The Brazilian state-owned oil and gas company Petrobras $PETR3 (+1,29%)
$PETR4 (+0,43%) has terminated the contract with Enauta of Brava Energia for the sale of all its shares in the Uruguá and Tamba fields.

Under the contract signed by the companies in July 2024, Petrobras was to receive USD 35 million for the share sale and stated at the time that the transfer of the assets to a new operator was an alternative to their decommissioning and offered the prospect of extending their productive life.

"The closing of the transaction was conditional, among other things, on Enauta Energia acquiring the FPSO Cidade de Santos, owned and operated by MODEC, which did not happen. As provided in the contract, the amount paid as a deposit on December 21, 2023 will be retained by Petrobras," the company said in the statement.

The Uruguá and Tambaú fields are part of the BS-500 concession, which was acquired as part of the National Agency for Petroleum, Natural Gas and Biofuels (ANP) zero round.

The fields are located in the northern part of the Santos Basin, between 140 and 160 km off the coast of the state of Rio de Janeiro, in water depths of 1,000 to 1,500 meters.

The average production of the fields until September 2023 was around 5.4 thousand bpd of oil and 353 thousand m3/day of gas. Petrobras holds 100% of the shares in both fields, which are produced via the MODEC-chartered FPSO Cidade de Santos.

Petrobras retains 100% of the shares in the Uruguá and Tambaú fields and will evaluate suitable alternatives for the management of the assets.

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Shearwater Geoservices Holding AS ("Shearwater") has been awarded a contract by Petrobras $PETR4 (+0,43%) to commence one of two 4D projects in Brazil, covering the Jubarte and Tartaruga Verde fields in the Campos Basin. The eight-month engagement, the award of which was announced on January 4, 2023, will be carried out with the Shearwater high-performance vessel Oceanic Vega and will begin shortly. The projects have been added to the order backlog since the contract was awarded.

"We look forward to the successful execution of these projects and to providing Petrobras with high quality seismic data covering these important fields in the Campos Basin," said Irene Waage Basili, CEO of Shearwater.

Petrobras $PETR3 (+1,29%)
$PETR4 (+0,43%) has taken a first step towards structuring a business partnership aimed at building a low-carbon hydrogen plant on a commercial scale in the Brazilian state of Paraná with the signing of a memorandum of understanding between Companhia Siderúrgica Nacional (CSN) and CSN Inova Soluções.

Low-carbon hydrogen can be used in industrial processes or as a fuel and is produced through the electrolysis of water from renewable electricity sources. The initiative aims to support the decarbonization efforts of CSN and Petrobras operations and products.

Petrobras did not specify which renewable energy sources will be used for the production of hydrogen.

The signing of this MoU is in line with Petrobras' Strategic Plan 2050 and Business Plan 2025-2029, which aim to prepare Petrobras for a fair energy transition, reduce its emissions and expand its range of more sustainable products.

The state-controlled oil giant Petrobras $PETR3 (+1,29%)
$PETR4 (+0,43%) has taken another important step to support its offshore activities, marking a significant development for the Brazilian oil industry. The company has entered into a partnership with Constellation Oil Services, a leader in offshore drilling. The collaboration centers on the deployment of Constellation's Amaralina Star drillship, which is expected to play a key role in the country's growing oil and gas sector.

PBR has awarded Constellation a three-year contract worth 528 million US dollars. This contract includes a mobilization fee of $39 million, as well as various integrated services that PBR has requested for its offshore drilling operations. The deployment of the Amaralina Star will be a key component of Petrobras' plans and operations are scheduled to begin in the first quarter of 2026.

Expansion of activities in key offshore areas

Amaralina Star will operate primarily in two of Brazil's most promising and prospective offshore areas, namely the Northern Equatorial Margin and the Southern Pelotas Basin. These areas are expected to play a crucial role in Petrobras' strategy to maintain its leadership position in global oil production. Petrobras places great emphasis on maximizing offshore exploration and continues to focus on these key regions to achieve its ambitious growth targets in the coming years.

Petrobras
$PETR3 (+1,29%)
$PETR4 (+0,43%) signs 2.8 billion dollar contract for 12 new vessels to supply offshore platforms

Brazilian state-owned oil company Petrobras announced that it has signed a contract worth 16.5 billion reals (2.8 billion US dollars) to build and charter 12 new vessels to supply its offshore platforms.

About 5.2 billion reais have been allocated for the construction of the vessels by Bram Offshore and Starnav Servicos Maritimos in Brazil's southern state of Santa Catarina, Petrobras said in a statement.

The investment is part of the modernization of Petrobras' fleet of support vessels under the company's strategic plan for the period 2025-2029.

The contracts provide for a period of up to four years for mobilization and 12 years for operation, in addition to the requirement of 40% local added value during the construction phase, Petrobras said.

Expro cooperates with Petrobras in the development of a new flow meter technology $PETR3 (+1,29%)
$PETR4 (+0,43%)

Expro, a leading provider of energy services, has signed a technology agreement (ETEC) with Petrobras for the development of a new non-intrusive flow meter.

The technology will provide flow rates and detect flow patterns, providing online and real-time data to control and monitor slug instabilities to increase efficiency and optimize well production.

The key requirement for this technology development is the non-intrusive aspect of the clamp-on design and the absence of a radioactive source. The first prototype is expected to be installed by Q3 2027.

Gregorio Rodrigues, Expro Vice President of Well Flow Management, commented on the agreement as follows: "We are delighted to partner with Petrobras to continue providing measurement solutions across Brazil. Expro is a pioneer in the development of Mobile Fiscal Metering packages and has successfully completed flow measurements in over 1,000 wells for a number of customers, including Petrobras. We strive to innovate consistently and purposefully, and this agreement is a testament to our commitment as a technology-driven company.