Petroleo Brasileiro Petrobras SA ADR

Petrobras reported second-quarter consolidated net income attributable to shareholders of $10.4 billion, up from $4.7 billion in the same period last year. Revenue rose 60 percent year-over-year to $33.6 billion, exceeding analyst estimates by $2.35 billion.

Brazilian state oil company Petrobras reported second-quarter net profit of 52.4 billion reais, a 96% increase from the same period last year, marking the third-highest level in the company's history. Soaring crude oil prices amid the US-Iran conflict boosted performance, with profit exceeding the 44.7 billion reais analyst consensus compiled by LSEG. Adjusted EBITDA rose 79.6% to 93.8 billion reais, and net revenue climbed 42.3% to 169.5 billion reais, both beating market expectations. The company announced it will pay shareholders 17.4 billion reais in dividends and interest on equity. On the other hand, the Brazilian government's fuel price control measures, export tax payments, and delays in receiving subsidies weighed on results.

SBM Offshore raised its full-year 2026 guidance after reporting a record first half. Directional revenue increased to $4.9 billion and directional EBITDA nearly doubled to $1.3 billion, driven by new contracts including the FPSO SEAP 1 and SEAP 2 awards from Petrobras and a feed contract for ExxonMobil Guyana's long-tail development. The company's backlog reached a record $35.6 billion, and it now expects full-year directional revenue of around $7.6 billion and directional EBITDA of around $1.9 billion. Fleet uptime remained around 99% across 16 operating units, and the company is on track to deliver a minimum of $2.1 billion in shareholder returns for 2026-2031. The sale of FPSO One Guyana and a minority interest in FPSO Dalji helped reduce net debt to $3.7 billion, though the company noted a fatality at a subcontractor's yard in China and ongoing working capital drag.

Petrobras and Ecopetrol announced a deepwater natural gas discovery offshore Colombia with the drilling of the Sandía-1 exploratory well. The well is located 18 kilometers from the Sirius-1 and Sirius-2 wells and 9 kilometers from the Copoazu-1 well, indicating strong gas potential in the Sirius area. The companies have so far unlocked in-place volumes of more than 6 trillion cubic feet of gas in the Sirius area with the drilling of five wells in water depths of more than 1,000 meters in Block GUA-OFF-0 in the Guajira Offshore basin. Petrobras operates the block with a 44.44% stake, while Ecopetrol holds 55.56%.

Petrobras reported record oil and gas production in the second quarter of 2026, with average equity output reaching 3.34 million barrels of oil equivalent per day, a 14.1% increase from a year earlier and 3.4% above the first quarter. The growth was driven by improved operating efficiency and production ramp-ups at several floating production units, including the Maria Quitéria FPSO, the Alexandre de Gusmão FPSO, the P-78 unit, and the startup of the P-79 platform at the Búzios field, where average monthly production surpassed 1 million barrels per day for the first time in June. The company also achieved a record refinery utilization rate of 101.2%, surpassing the previous high set in 2014, which helped lift refined product output to 1.918 million barrels per day and reduce imports of refined products to a record low of 67,000 barrels per day. Pre-salt crude represented 73% of refinery feedstock during the quarter, and in April all of Petrobras' refineries became capable of processing 100% pre-salt crude under its RefTOP modernization program. Higher crude production also pushed exports to nearly 1 million barrels per day while crude imports fell to 89,000 barrels per day, their lowest since the COVID-19 pandemic.

Vallourec has been awarded a contract by Allseas to supply carbon steel seamless line pipes and thermal insulation coating for the Atapu 2 offshore project in Brazil. The contract covers 143 kilometers of rigid risers and flowlines, representing approximately 19,000 tons of bare line pipe. The pipes will be produced at Vallourec's Jeceaba mill, while the coating will be applied at its Serra facility, leveraging capabilities from the recent acquisition of Thermotite do Brasil. The Atapu 2 project, operated by Petrobras on behalf of the Unitized ATAPU consortium, will develop part of the Atapu Field in the Santos Basin at water depths between 2,000 and 2,350 meters, with 18 wells connected to a floating production storage and offloading unit.

The Franklin FTSE Brazil ETF, trading under the ticker FLBR, has outperformed the iShares MSCI Brazil ETF, EWZ, by roughly 5 percentage points year-to-date in 2026 while charging an expense ratio of 0.19 percent, less than one-third of EWZ's 0.59 percent. FLBR returned 17.65 percent through July 13, 2026, compared with 12.46 percent for EWZ, and over the trailing year it gained 37.61 percent against EWZ's 34.44 percent. The performance gap stems from the lower fee and differences in index construction: FLBR excludes Nu Holdings, which accounts for 9.18 percent of EWZ, and runs heavier exposure to Vale and Petrobras, with Vale at 11.39 percent of FLBR versus 9.94 percent of EWZ. FLBR also offers a higher dividend yield of 5.84 percent. For investors in tax-advantaged accounts, swapping from EWZ to FLBR is straightforward, but taxable holders with large embedded gains may find the tax hit outweighs the fee savings.

Petróleo Brasileiro S.A. – Petrobras has approved a mechanism to limit gas price volatility by introducing floor and ceiling levels tied to Brent crude prices. The mechanism ensures that the gas price will not increase by 6% for state distributors in August and will apply to all customers who choose to adopt it by amending their supply contracts. This move comes as Brazil scales back government fuel support and follows a June 23 non-binding memorandum of understanding with Petróleos Mexicanos to collaborate on oil exploration, production, and refining in the Gulf of Mexico.

Petrobras has signed an agreement with Brazil's oil regulator ANP to bring 335 temporarily abandoned offshore wells into full compliance by the end of 2030. The deal requires Petrobras to pay 300 million Brazilian reais, approximately $58.3 million, to the regulator. The company has already completed compliance work on 233 of the 335 wells, leaving 102 wells still to be addressed. The agreement provides a structured roadmap and timeline rather than immediate enforcement actions, reflecting a collaborative approach between the state-run energy giant and the regulator. This settlement resolves outstanding regulatory issues and reinforces Petrobras' commitment to safety and environmental standards in its offshore operations.

Oceaneering International has been awarded a four-year contract by Petrobras to provide remotely operated vehicle services offshore Brazil. The company will supply two work-class ROVs and specialized tooling packages, along with monitoring and positioning support services, with operations expected to begin in 2027. The ROV systems will be deployed from the AKOFS Offshore vessel Aker Wayfarer, which Petrobras has contracted for intervention, installation and abandonment activities. Financial terms were not disclosed. Oceaneering noted it has supported Petrobras' subsea engineering campaigns for more than a decade and has operated in Brazil for nearly 30 years through its subsidiary Marine Production Systems do Brasil.

Petrobras has received board approval for a $1.2 billion investment to construct a new biofuels facility at the Presidente Bernardes Refinery in Cubatão, Brazil. The project is scheduled to begin construction by the end of 2026 and is designed to produce 15,000 barrels per day of bio-jet fuel and renewable diesel, with operations expected to start in 2030. This initiative is a core component of the company's 2026–2030 Business Plan and aligns with Brazil's Future Fuel Law, aiming to support international aviation standards such as the Carbon Offsetting and Reduction Scheme for International Aviation, or CORSIA, while advancing a broader energy transition strategy.

Petrobras announced an agreement to acquire a 50% stake in the Itaimbezinho exploration block within Brazil's Campos Basin from Equinor. Equinor will retain the remaining 50% interest and continue as operator, while Pré-Sal Petróleo S.A. maintains management of the production-sharing contract. The deal, pending Brazilian regulatory approval, supports Petrobras' exploration pipeline to offset production declines in mature fields and aligns with its 2026-2030 Business Plan prioritizing exploration and strategic joint ventures. The partnership builds on existing collaborations between the companies, including the Raia gas development.

Petrobras and Finep have launched a R$150 million program to accelerate domestic electrolyzer technology and strengthen Brazil's low-carbon hydrogen economy. The initiative will fund a single large-scale strategic project through a public call, requiring consortia of at least three technology companies and one research institution. Projects must demonstrate clear advancements over current international systems, with at least 50% domestic content. The non-repayable funding is split equally between Petrobras and Finep, covering the full development cycle from design to a pre-commercial prototype. The effort aims to close Brazil's electrolyzer manufacturing gap, where no company currently produces electrolyzer stacks, and aligns with broader national energy transition investments.

Petrobras announced that its flagship Búzios field in Brazil's Santos Basin pre-salt province has reached a record average daily production of 1.1 million barrels of oil, surpassing the previous milestone of 1 million barrels per day achieved in October 2025. The increase reflects accelerating output from the recently commissioned P-78 and P-79 floating production, storage, and offloading units, which are still ramping toward their nameplate capacities of 180,000 barrels per day each. Búzios is Brazil's largest producing oil field and accounts for roughly one-third of all oil production operated by Petrobras in Brazil, including partner volumes, and nearly half of the company's equity production. The field currently produces through eight offshore facilities, with plans to ultimately operate a total of 12 FPSOs, as three additional units are under construction and a twelfth remains in the procurement phase. Located in ultra-deep waters more than 2,000 meters below sea level, Búzios is only the second field in Petrobras' portfolio to exceed 1 million barrels per day after the neighboring Tupi field.

Petrobras and Pemex have signed a non-binding memorandum of understanding to cooperate on exploration, production, refining, and industrial energy processes. The two-year framework targets joint evaluation of opportunities in the Gulf of Mexico, including deepwater blocks and mature fields requiring enhanced recovery, with Petrobras contributing ultra-deepwater expertise and Pemex offering operational experience in legacy assets. The agreement also covers downstream collaboration in refining, petrochemicals, and fertilizers, alongside structured technical knowledge exchange. Any future projects will require separate negotiations and regulatory approvals.

Petróleo Brasileiro’s Board of Directors approved the Final Investment Decision for the RPBC Biorefining project. The project involves building a dedicated plant at the Presidente Bernardes Refinery in Cubatão, São Paulo state, to produce bio-jet fuel and renewable diesel, with an estimated investment of around US$1.2 billion. Construction is expected to begin by the end of 2026, and the plant will have a production capacity of up to 15,000 barrels per day of renewable fuels, with start-up scheduled for 2030. The project is included in the company’s Business Plan 2026–2030 and has been incorporated into the Base Implementation Portfolio after a consideration of financing conditions.

Petrobras plans to restart construction of the long-delayed UFN-III fertilizer plant in Três Lagoas, Mato Grosso do Sul, with work expected to resume by September. The project, inactive since 2015, will require an estimated investment of $1 billion and aims to begin commercial operations by 2029. Once operational, the facility will produce 3,600 metric tons of urea and 2,200 metric tons of ammonia per day, reducing Brazilian urea imports by approximately 12% on its own. Combined with other reactivated nitrogen fertilizer facilities in Paraná, Bahia, and Sergipe, the company expects to cut urea imports by up to 35%. The plant's strategic location near major agricultural states is expected to lower transportation costs and strengthen domestic fertilizer supply.