VistaBrazil - March 2015

Petrobras struggles to raise cash as shares downgraded to junk

Two weeks after Aldemir Bendine took over as chief executive officer of Petrobras, the company was downgraded to Ba2 by Moody's Investors Service on 24 February. That puts its rating at two notches below investment grade, the second downgrade in less than a month. Brazil itself is rated three steps higher, at Baa2.

The company is exploring financing options in response. It needs to sell at least US$20 billion in assets and reduce capital expenditures to approximately US$25 billion for 2015, according to a recent Bank of America report. The BofA report pointed to the potential for Petrobras to raise significant sums from its exploration and production assets if oil prices rebound.