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Petrobras Prospects | 4’49”

Source:  Blog da Cidadania (Edu Guimarães, Brazil)

During its broadcast of the Jornal Nacional on February 9, Globo spent 4’49” reporting that from 2008 to 2015, Petrobras, according what Globo likes to call its “experts,” lost 75% of its market value due to “management errors,” dropping from US$ 510 billion seven years ago to US$ 116 billion today.

One of these experts took advantage of the occasion to say that Petrobrás carries the largest debt in the world, estimated at US$ 261 billion.

Below, the news segment in question.

The first dirty trick in this report is the valuation of Petrobrás at US$510 billion as of 2008. During the course of that year, the barrel of petroleum reached US$ 135 before falling to US$ 48 late in the year. The evaluation that the company was worth US$ 510 billion was made during the upturn in oil prices.

Had Globo used the price of a barrel between October and December, its estimate of market value would have been much lower.

But that is not all. The Globo “experts” commented on the amount of debt carried by the company, quoted as US$ 261 billion, but forgot to mention that the pre-salt reserves grew to 27 billion barrels of petroleum, in which case, given the current price per barrel, its market value rose to some R$ 1.5 trillion.

Editor’s note: this estimate of pre-salt volume comes from the daily O Estado de São Paulo.

Even more curious was when the Jornal Nacional, in reference to the market value of the company, “forgot” to tell its viewers that this decline in market value was due in large part to the significant decline in oil prices, which fell from US$ 100 to about US$ 50 as of yesterday.

And as long as the JN was talking about Petrobras and its market value, it might also have been honest enough with its viewers to point out that in 2002, the company was worth a mere US$ 15 billion, which means that if today its market value is US$ 116 billion, under the federal governments of the PT it has increased seven-fold.

Below, an article from the daily O Globo acknowledging that during the last year of the second Cardoso government, Petrobrás was worth only US$ 15 billion.


Naturally, the discovery of corruption at the firm has provoked a decline in market value, but for all that — declining oil prices and corruption — Petrobras today is much stronger and more promising than it was 12 years ago. For this reason, assigning only negative attributes to the company is nothing but cheap political gamesmanship, a “sport” the all-powerful Globo never tires of playing.

As Folha de S. Paulo columnist Janio de Freitas observes, there are two Petrobrases — one a company destroyed by negligence and corruption and the other a winning company, a record-holder in production and productivity and an award-winner for technological innovation. The editors conceal that fact that Petrobras is working full steam ahead, and that for the most part the investments in the pre-salt layer are done, because investors know the company can weather the impact of negative news stories.

This news coverage has other objectives, however, such as justifying a bill of impeachment against the federal president, a notion sprung from the crowned head of ex-president Fernando Henrique Cardoso.

The legal opinion that inserted [a Paraguayan] coup attempt into the political conversation, prepared by legal scholar Ives Gandra Martins — the Opus Dei spiritual counselor of São Paulo Governor Geraldo Alckmin — makes a curious recommendation: that the investigation of the Petrobras scandal be confined to the mandate of the current president.

This would apparently be his basic argument for a technical  argument in favor of enacting an impeachment process. Another might argue that the case known as Car Wash is far more ample in time and scope, and that this would not serve to concentrate the focus on the board chairman as she resigns, and by extension the president of the republic [, former chairman of the board of Petrobras].


The only barrier preventing the congress from carrying out the impeachment gambit devised by ex-president Fernando Henrique is the immense political influence of his successor, ex-president Lula da Silva. This leaves us with a peculiar script: the more the press beats up on Dilma, the more strongly Lula emerges as a candidate in 2018, because, unlike Lula, Dilma cannot count on the unconditional support of the mass of party militants.

It would take a non-stop bombardment of negative headlines four years long — or a rapid removal of the current president from office — to undermine the political capital that could carry the former union leader back to the Presidency.

The viewpoint of the media establishment is facilitated by the fact that they are interested in one thing only: to reverse the model that makes the State a manager and regulator of economic policy and not just a mediator of clashes among market forces. Petrobras became a symbol of this model when it exchanged the concession system created by Fernando Henrique Cardoso in 1997 for the partitioning  system instituted by Lula in 2009.

The major multinationals of the petroleum sector found themselves without concessions in the principal fountainhead of oil in the world that is not operated in a conflict zone. The Brazilian press applauded the end of the Petrobras monopoly, in 1997, and condemned the pre-salt model in 2009.