- Brazil’s FUP union starts a nationwide work stoppage
- Producer Petrobras is slashing investments to reduce debt
Brazil’s main oil union began a nationwide strike Sunday to halt asset sales by state-controlled Petroleo Brasileiro SA at a time the company is slashing investments to reduce the biggest debt load in the oil industry.
The Oil Workers Federation, known as FUP, said the nationwide strike started on Nov. 1. Some of the FUP’s regional member unions began work stoppages on Oct. 29. FUP also wants Petrobras to resume investments in the refining network and maintain Buy in Brazil policies to protect jobs, it said in the statement in its website.
Petrobras said in an e-mailed statement sent to Bloomberg News that a work stoppage from some units won’t affect its production or deliveries to the market.
The strike is the latest in a series of setbacks for the Brazilian producer, which had its debt downgraded to non-investment grade in September as it tries to deal with a collapse in commodity prices and a widening graft scandal that has resulted in some of its suppliers seeking bankruptcy protection.
Petrobras plans to continue holding talks with the union and it has offered an 8.1 percent wage adjustment, the company said in the statement. The union has been negotiating with Petrobras for more than 100 days, it said on its website.
Petrobras plans to sell $15.1 billion in assets this year and in 2016 to raise cash for investments and debt reduction. On Oct. 24, Petrobras’s board approved the sale of a 49 percent stake in its gas pipeline unit Gaspetro to Mitsui & Co Ltd. for 1.9 billion reais ($490 million).