Oil Boom Is Stock Bust for Petrobras as Capex Saps Cash
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Petroleo Brasileiro SA’s imminent ascent in the global oil output ranking contrasts with its sliding market value as Brazil’s deteriorating finances dash investor hopes for relief in fuel subsidies paid by the company.
The state-run company known as Petrobras is set to challenge PetroChina Co. as the second largest publicly-traded oil producer after adding six new platforms since November. The prospect of ending a two-year output decline is failing to appease investors who are concerned by the government’s insistence it sell imported fuel at a loss, while investing $237 billion to develop the biggest oil discoveries this century.