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Brazil asked to raise oil production

Reuters reports three people familiar with the matter as saying that US government officials approached Petrobras, the state-owned oil company of Brazil, about raising production to mitigate the effect that Russia’s invasion of Ukraine was having on oil prices.

In a statement to Reuters, a US State Department spokesperson did not specifically refer to the meeting with Petrobras officials, instead saying:

“We are doing everything possible with our allies and partners to mitigate the economic impacts of Russian actions on other economies like Brazil. We are working with energy companies to surge their capacity to supply energy to the market, particularly as prices increase.”

While some oil-producing companies – such as ExxonMobil, the maker of the Mobil DTE hydraulic oil range

– have signalled their intention to increase production, others have been less keen to do so despite high prices, with pressure from investors being commonly cited.

The three sources all conveyed that Petrobras believed that such an increase would not be possible, saying that logistical challenges and strategic goals excluded it from happening. While the Brazilian Government has the largest stake in Petrobras by far, executives at the firm insist that the company is independent of political control, so its decisions are guided by its long-term business plan rather than international diplomacy.

The officials from Petrobras did, however, reportedly point to its medium-term plan to increase the country’s crude oil production by half a million barrels per day by 2026. Brazil is currently the world’s ninth-largest oil-producing country, having experienced an offshore oil boom in recent years.

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