Brazilian oil producer Petrobras reported a net profit of $8.64bn in Q1 2022, 40x higher compared to the previous year, on higher revenue growth of 73.2% to $27.19bn. Revenues increased mainly due to higher Brent crude prices, higher volumes of oil sales in the domestic market, and the higher volume of oil exports due to the growth in oil production. The company announced $9.7bn in dividends to be paid in 2022, that mainly corresponds to results from the first quarter. Adjusted EBITDA rose 68% YoY to $14.96bn, with strong free cash flows of $ 7.9bn, 41.8% higher YoY, and up 5.6% QoQ. Net debt dropped 31.4% to $58.6bn over the year. In Q1, capex totaled $1.8bn, out of which more than 53% of it was related to growth increasing the capacity of existing assets, deploying new production, offloading, and storage assets, and increasing asset efficiency or profitability. Analysts note that in Brazil, fuel prices have become politicized with elections in October 2022. The current president Bolsonaro called on Petrobras to freeze fuel prices saying that its profits were unacceptable during a crisis.

Petrobras’ dollar bonds were higher with its 6.25% 2026s up 0.53 points to 103.73, yielding 5.31%.

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