(Recasts to add oil price performance, comments, background
By Marianna Parraga and Guillermo Parra-Bernal
HOUSTON/SAO PAULO May 2 Oil's lackluster price
performance this year is unlikely to hamper Petróleo Brasileiro
SA's plan to divest up to $21 billion worth of assets or find
partners for exploration and refining by the end of next year,
Chief Executive Officer Pedro Parente said on Tuesday.
Speaking at the Offshore Technology Conference in Houston,
Parente said Petrobras has already made money in an
unstable oil price environment, which could lure partners for
certain businesses or projects. Rio de Janeiro-based Petrobras
is Brazil's state-controlled oil company.
Parente remains confident that Petrobras will be able to
divest assets in segments from oil exploration and production to
fuel retailing, meeting the year-end 2018 asset-sale and
partnership target comfortably.
"We can only improve by having partners helping us to get
more benefits ... I don't see why the current oil price
environment would create risks for our divestment plan," he said
on the sidelines of the conference.
His remarks sought to allay concern that a volatile oil
market could slow or thwart plans to downsize Petrobras, the
world's most indebted oil company. After starting the year on a
rally, oil prices have slumped as rising crude output in the
United States and elsewhere has somewhat offset production cuts
by Saudi Arabia and other major exporters looking to reduce a
global crude glut.
Brent crude oil prices fell on Tuesday to their lowest level
in more than five months, erasing all the gains since the
Organization of Petroleum Exporting Countries began output cuts
last November. Brent futures fell $1.06, or 2.1 percent,
to settle at $50.46 a barrel, the lowest close since Nov. 29 -
the day before OPEC agreed to cut supply.
Investors cut their net-long position in Brent oil, the
crude benchmark most widely used for pricing by Petrobras, by
69,167 contracts to 358,266 in the week ended on April 25. That
was the lowest since November. Net-long positions measure the
difference between bets of a price increase and those of a price
Parente cited geopolitical tension in the Middle East,
sizable legal contingencies and missing asset-sale goals as
potential risks for Petrobras's financial and operational case
He wants Petrobras to focus on cutting costs as much as
other Latin American oil companies are doing. At the end of
2016, the company's lifting cost per barrel went down to $10.3
per barrel from $11.7 a barrel in 2015.
(Additional reporting by Marta Nogueira in Rio de Janeiro and
Roberto Samora in São Paulo; Editing by Chizu Nomiyama and David