Brazil´s energy sector decline, reform, recovery and newfound impulse
RIO DE JANEIRO – The collapse in oil prices in late 2014 and ensuing slow recovery until mid-2017, combined with a severe macroeconomic crisis and instability that hit Brazil at about the same time, bruised in the Brazilian oil sector. The crisis was compounded with the national oil company´s debt and corruption inquiries, and with the country´s growing deficit and loss of sovereign investment grade.
The crisis shed light on how stringent regulations were deterring foreign investments, especially since Petrobras no longer had the means to singlehandedly develop Brazil´s offshore resources, let alone the rest of the oil & gas value chain. Today, Brazil stands out as one of the leading oil provinces in the world.
The below report focuses on how key events drove the country´s oil sector development back from the brink. The strategic repositioning of Petrobras, new technologies, cost reductions and good geology played their part. However, the revised regulatory framework and the governments’ new stance towards the sector are what effectively altered the country´s perception, allowing Brazil not only to overcome the crisis, but also to thrive.
Special Report on the Recent Developments in the Brazilian Oil Industry