Brazilian state oil company announced on Tuesday a cut of 32 billion U.S. dollars in its investment budget, and a 1.8 percent drop in its planned production for 2016.
In a press release, Petrobras said that it will invest 98.4 billion dollars in 2015-2019, down from the previous 130.3 billion U.S. dollars, due to falling oil prices and the devaluation of the real against the U.S. dollar.
This is the third successive cut in Petrobras' five-year budget, which was originally set for 221 billion dollars.
Meanwhile, it also lowered its production targets to 2.145 million barrels per day (bpd) in 2016 and to 2.7 million bpd in 2020, down from 2.185 million bpd for 2016 and 2.8 million bpd for 2020, respectively. Petrobras said it will maintain its priorities in exploration and production, especially in the pre-salt zones of its deepwater Atlantic reservoirs.
Furthermore, the company is staying on track to divest itself of 15.1 billion U.S. dollars in assets in 2015-2016, with 700 million U.S. dollars in sales having already been completed. Petrobras is undergoing a deep economic and institutional crisis after the emergence of a major corruption ring within its ranks and suppliers, which led to at least 2 billion U.S. dollars being embezzled between 2004 and 2014.
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