Brazil up in ranking and becomes 9th largest oil producer in the world

 

Lack of investments, however, should increase dependence on imports of derivatives

RIO – Brazil has risen another step in the ranking of the ten largest oil producing countries in the world. The country is in 9th place with an average production of 3.2 million barrels of oil (oil and gas) per day, representing 3% of total world production. The ranking is from the International Energy Agency (EIA), based on data from 2017. Brazil has passed Kuwait, a member country of the Organization of the Petroleum Exporting Countries (OPEC), which produced 3, 1 million barrels.

The director of Petroleum, Gas and Biofuels Studies of the Energy Research Company (EPE), José Mauro Coelho, pointed out that everything indicates that oil production will continue to grow significantly in the country in the coming years. According to the executive, the expectation is that in 2026 Brazilian production will reach 5.2 million barrels per day of oil, almost double that produced in 2016, a volume of 2.7 million barrels per day.

But, according to José Mauro, the lack of investment in expanding refining in the country could make Brazil in 2026 among the five largest oil exporters in the world. This is because, without expanding the refining capacity in the country to meet the increase in fuel consumption, while crude oil will remain to be exported, the country will have to import more volume of derivatives.

– Due to the low investments in refining in the period, in 2026 we could be exporting something around 3 million barrels / day. We will be among the top five oil exporters in the world. Possibly behind only Saudi Arabia, Russia, Iraq and Canada – he pointed out.

Without new investments to increase refining capacity in the country, of which 98% is controlled by Petrobras, in 2026 Brazil will be a strong importer of derivatives, which is not good in strategic terms. And derivatives in the international market have a price higher than the price of crude oil. EPE projections indicate that, in 2026, with the increase in fuel demand, Brazil should have to import around 800 thousand barrels per day of fuels.

– Our projections show that if we do not invest in refining, in 2026 we will be importing around 800,000 barrels a day of oil products, in particular diesel, as well as other derivatives such as LPG, naphtha, gasoline and aviation fuel, said José Mauro.

 

The National Petroleum Agency (ANP) opened a public consultation on 11 October to discuss the periodicity of passing on fuel price increases to consumers. Petrobras’ policy of almost daily readjustments in fuels has provoked strong discussion. The move intensified after the truckers strike, which had among the points under discussion the increases in diesel prices.

The director general of the ANP, Décio Oddone, has justified his decision to study the periodicity of the readjustments for the consumers,  the fact being that the market is distorted, monopolistic, dominated by Petrobras, and, according to Décio Oddone, investing in refining in Brazil is fundamental.

Source: The Globo |

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