SÃO PAULO – Over the years, Petrobras shares – which are among the most traded on the Brazilian stock exchange – have become some of the best known among small investors. Popularization policies, such as the one that allowed workers to apply part of FGTS resources to company papers, in the early 2000s, made them known and desired for a long time.
But since 2008, when they reached their highest value, in the wake of the demand for commodities and just before they were brought down by the global financial crisis that started in the American real estate sector, problems of all kinds have undermined Petrobras’ quotations – and the passion of investors for state-owned shares.
The most recent, last Friday (19), was the appointment of the government of General Joaquim Silva e Luna as a substitute for President Roberto Castello Branco.
But what happened in each of the last crises experienced by Petrobras’ actions? InfoMoney listed four recent cases. Check out:
Coronavirus pandemic (2020)
In early 2020, Petrobras’ preferred shares (PETR4) they came from a three-month period quoted at around R $ 30. In about a month, between February and March, the shares fell to the level of R $ 11.
The fall came amid the outbreak of the coronavirus pandemic, which brought down demand for oil and started a price war between producing countries. Russia and the nations associated with the Organization of Petroleum Exporting Countries (OPEC) did not agree on production levels.
In view of the impasse, which had already been causing an impact on prices, Saudi Arabia – one of the countries with the most competitive conditions of production – announced the decision to increase the levels of extraction.
With the prospect of excess supply and demand falling, given the circulation restrictions due to the pandemic, the value of the commodity in the global market has plummeted. The situation reached the point where futures contracts were negotiated at negative values, something unprecedented.
With the return of activities that had been suspended and the gradual recovery of oil prices, Petrobras’ shares also returned to previous levels. “We can say that the return of quotations was even quick,” says João Paulo Teixeira Cardoso, partner at Unnião Investimentos.
What happened next? At the beginning of January this year, the preferred shares were once again quoted above R $ 30, eliminating the losses of 2020.
Truckers strike (2018)
The rise in fuel prices, especially diesel, led truck drivers to paralyze activities – and consequently, Brazil – for about 10 days, in May 2018. Supply chains were affected, with unprecedented impacts on the distribution of food, medical supplies, among others.
At the time, the then Ministry of Finance even estimated that the shutdown eliminated 1.2 percentage points of that year’s GDP growth.
Petrobras’ preferred shares (PETR4) dropped 44% between May 15 and June 15, deepening losses with the resignation of Pedro Parente, who presided over the state company at the time. Only on the day of the announcement of his departure, the papers fell by almost 15%.
Parente had commanded Petrobras for two years, having replaced Aldemir Bendine, involved in the complaints made by Operation Lava Jato. During his tenure, a fuel pricing policy was established, based on two factors: parity with the values practiced in the international market and a margin to compensate for risks inherent to the operation, such as exchange rate volatility and taxes.
What happened next? Petrobras’ shares took approximately four months to recover in October 2018.
Joesley Day (2017)
The Brazilian stock exchange had its first circuit breaker – business interruption due to the sharp drop in the market – in more than 10 years on May 18, 2017, and Petrobras’ shares contributed to this scenario.
The date became known as “Joesley Day”. The day before, an audio recorded by Joesley Batista, one of the owners of the JBS slaughterhouse, of a conversation with the then President of the Republic, Michel Temer, had been released.
The audio implied that Temer gave his approval for the purchase of the silence of former deputy Eduardo Cunha, arrested for developments related to the Lava-Jato operation. The reaction of the market – which began to see Temer’s resignation as a real possibility – was acute.
“The pension reform, which was an important issue at the time, was almost approved and was at risk. There was a big increase in country risk that affected all sectors, extrapolating its effects also to state companies such as Petrobras ”, says Carlos Daltozo, head of Variable Income at Eleven Financial. Preferred shares fell by almost 16% in a single trading session.
What happened next? Petrobras shares retreated on Joesley Day, but did not deepen the decline much in the following weeks. In September 2017, prices were back to pre-crisis levels.
Operation Car Wash (2014)
The years 2014 and 2015, in addition to part of 2016, were marked by successive losses in the value of Petrobras in the market due to the revelations of Operation Lava Jato, which began in March 2014.
Petrobras’ involvement in the corruption scheme – based on charging bribes from contractors, money laundering, evasion of foreign exchange and overpricing of public works – became known as “Petrolão” and undermined investor confidence in the state-owned company.
Senior members of the company were arrested, such as Paulo Roberto Costa (former Supply Director), Nestor Cerveró (former Director of the International area and former Financial Director of BR Distribuidora), Renato Duque (former Services Director), Pedro Barusco (ex-executive manager of Engineering), Jorge Zelada (Cerveró’s successor in the International area), among others.
“All denunciations of deviations and winning claims exploded at that time,” recalls Daltozo, from Eleven. With each new award awarded, more denunciations were added to the previous ones, causing new losses to shareholders on the stock exchange.
The problems caused by corruption led Petrobras to record, in 2014, the biggest annual loss since 1991. The company reported that the write-off due to the payment scheme investigated by Lava Jato had exceeded R $ 6 billion.
Between January 1, 2014 and December 31, 2015, Petrobras’ preferred shares lost 57% of their value.
What happened next? With the gradual reorganization of the company’s accounts, changes in the board, creation of divestment plans and changes in pricing policies, the shares recovered. There were many ups and downs, but the papers returned to the level of late 2013 in October 2016.
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