Monday, August 11, 2008

Petrobras Q2 Results

Brazil's Petrobras Posts Record Profit.

SAO PAULO -(Dow Jones)- Aided by higher oil and oil-product prices and a break on federal taxes, Brazilian state-run energy giant Petrobras (PBR) on Monday posted a new all-time record for quarterly profits.

Second-quarter profits rose 29% from a year ago to 8.78 billion reals ($5.41 billion). Second quarter revenues were up 30% from a year ago to BRL54.57 billion. The company released its quarterly figures in BR GAAP terms.

In a statement, the company, also known as Petroleo Brasileiro SA, attributed the rise in profits and revenues to higher international and domestic oil and oil-product prices, among other factors.


Anaconda said...


Petrobas is an example of a growing and healthy petroleum company in the America's, South America to be specific.

Petrobas in terms of the world-wide petroleum business and market is a 'new player'. Yes, they've been around for a long time, but their emergence onto the world petroleum stage is relatively new, Petrobas' market value has soared in the last year, as new deepwater oil fields have been discovered off the Brazilian coast.

And as a 'new player', Petrobas' interest is in selling oil as fast as technology will allow from their newly discovered finds because to justify the company's market value, which is mostly based on expectations of future earnings, it's in Petrobas interest to sell oil.

Not hold it back.

Which brings this comment to it's major point: Russia has invaded Georgia, not so much for oil, but because Russia has oil & gas, which has provided the finances to power their geo-political ambitions.

High oil & gas prices on the world market finances Russia.

I have commented that it is in the interest of the West to be friends with Russia, but also:

"I don't want to see Western Europe in a position to be susceptible to political or economic blackmail by Russia through their petroleum clout -- and if Russia doesn't sense "natural gas can be used as a weapon" as a viable option they won't use it.

Again, the best way to avoid that senario is not to engage in confrontation, but to increase supplies that diminish Russia's dominance of oil & gas -- particularly gas, as this posted article states."

"In no way should Western Europe, the United States, and Japan for that matter, encourage Russia to take up old habits of intimidation in any fashion or guise."

But I also made this injunction:

"After all, if you voluntarily allow one supplier of natural gas to dominate the market in Western Europe -- don't expect that sole supplier to 'respect you in the morning.' "

Apparently, Russia feels it's morning in Europe after a night "sweating up" the sheets.

New supplies of oil & gas are critical for the West to drive down the world market price for those commodities.

It's a twofer:

One, the West's economy is given a shot in the arm with the strongest economic stimulus that can be administered.

As an example: The stock market has rallied on dropping oil prices.

Two, Russia derives its geo-political ambition from a sense of economic power resulting from its #1 status as an oil & gas producer during high prices.

America and the West must have new oil supplies not tied to the Eurasian land mass, which Russia stands athwart.

Petrobas is an example of new oil production outside the grasp of the Russian Bear.

We need more of the same and we need it now!!!

Seeing a lower price of oil and Europe not tied to Russian natural gas is the "price" Russia must "pay" for it's invasion of Georgia.

Can Western Europe "strand" Russian gas in Siberia because Europe has other sources?

Liquified natural gas (LNG) is the key to starving the Russian bear and thus "rewarding" Russia for it's military actions.

What lesson Russia learns from this incident is critical to Russia's future behavior.

And, Europe's political & economic health.

This is the communique needed:

Europe to Russia: "We like your natural gas, but we can go elsewhere to get our supplies."

"Bullying monopolies will not be tolerated."

This is the best lesson the Russian Bear can learn.

duffbeer said...

I very much enjoy your blog site and try to stop by daily. Due to you and anaconda I have learn much about the black gold and firery vapors.
I am just a normal guywho is not educated in this area but knew at an early age as oil costs go so does prices of every thing.
This post ,anaconda says it all. Do you thing anyone in Washington DC would understand it ???
Thank s to both of you for sharing your vast knowledge.
Cheers, DuffBeer

Anaconda said...

To DuffBeer,
Thank you for the feed back and your generous comments.

I do think there are people in Washington D.C. that appreciate the situation.

U.S. Struggles to Counter Energy-Rich Russia's Increasing Control over European Union

By DESMOND BUTLER | Associated Press Writer
August 12, 2008
WASHINGTON (AP) _ The Cold War competition between the United States and Russia — played out in Europe with the threat of mutual nuclear destruction — ended with the collapse of the Soviet empire nearly two decades ago.

But the Russian bear has re-emerged from its cave with a new and powerful weapon — the West's dependence on Moscow's vast energy supplies.

The Russians now supply about 25 percent of the European Union's crude oil needs and half of its natural gas.

And Moscow, with its recent attack on its former Georgian republic, may be trying to blunt the West's counteroffensive in the deadly serious energy competition. A key, U.S.-backed pipeline that carries oil out of Caspian and Central Asian fields to a Turkish port on the Mediterranean was nearly hit in recent attacks.

The stakes are high for the Europeans.

Some U.S. lawmakers worry about divisions within NATO due to Russia's domination of European gas markets and the threat of cold, dark winters if an angry Kremlin closes the valves.

"It is unlikely that aggression against our NATO allies will occur with aircraft and tanks and troops," said Indiana Sen. Richard Lugar, the senior Republican on the Senate Foreign Relations Committee, in an Associated Press interview..."

Please click linked headline for entire story.

So, Yes, there are officials in Washington who understand, but, as my previous comment stated, producing oil & gas in the Western Hemiphere is just as critical for energy security as the central Asian republics.

No matter what the United States does in central Asia there will always be potential for political or military security threats from Russia.

The key is to demonstrate central Asia is only one supply route, among many, for oil & gas to the West.

Supply diversification is the best way to say to oil & gas producers: "There are others that supply our market -- don't use oil & gas as a weapon -- it won't work and you'll lose a valuble customer in the process."

As much as I support 'alternative' energy and I do -- America will rely on oil & gas for many years.

Putting our heads in the sand as many people are inclined to do, simply is not a solution and only puts us in greater danger.

OilIsMastery said...

Thanks for stopping by Duff. Your comments are always welcome...=)