Petrobras Q1 Net Income Slips 14% as Crude Output Tops 3.2 M bpd
Petrobras reported Q1 net income of 45.3 billion reais, a 14% year-over-year decline, while crude output surged 5% to a record 3.2 million barrels per day. Downstream margins contracted as refining and fuel sales volumes dipped 3%.
1. Q1 Financial Results
In the first quarter, Petrobras recorded net income of 45.3 billion reais, down 14% year-over-year, driven by weaker refining margins and a 3% drop in fuel sales volumes. Operating expenses rose 6% due to maintenance costs and currency headwinds.
2. Record Production Levels
Crude production reached a new high of 3.2 million barrels per day, up 5% from Q1 last year, supported by ramp-ups at offshore fields and higher uptime at key platforms. Natural gas output also grew 4%, contributing to stronger upstream cash flow.
3. Margin Pressure and Market Dynamics
Downstream refining margins fell 12% as global fuel demand softened and turnaround schedules increased downtime. The company’s export sales provided some offset, but average refining utilization dipped to 85%.
4. Investor Implications
Despite output gains, lower earnings may pressure the dividend yield, although management reaffirmed its payout ratio target of 30–40% of distributable profits. Capital expenditure for 2026 is set at $20 billion, emphasizing offshore development and gas pipeline expansion.