Petrobras admits it could go through $1 bln per month

Petrobras admits it could go through $1 bln per month

Debt Corporate & Sovereign Strategy Coronavirus Energy Brazil

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Brazil's state-owned oil company Petrobras said on Friday that it could go through as much as $1 billion in cash per month during times of volatile commodity prices.

"Considering current costs and expenses and the high volatility of the price of commodities, it is not possible to accurately measure the use of the company's cash, which may, however, in a stress scenario, reach $1 billion in months of higher volatility," Petrobras said in a statement.

Petrobras put out the statement after local press reported that CFO Andrea de Almeida said during an internal event that the company could spend $1 billion per month during the coronavirus pandemic.

"The company reinforces that with the measures adopted it will ensure the maintenance of its financial health and cash balance in 2020," Petrobras added in the statement.

Petrobras has pressed ahead with asset sales in the midst of the coronavirus pandemic, but it said late last month that it does not expect to lower debt in 2020, instead ending the year with $87 billion in debt, the same amount as the end of 2019.

On May 7, Fitch Ratings put a negative outlook on Petrobras due to uncertainty over the length and severity of the coronavirus pandemic in Brazil, but it maintained the company's credit ratings at BB-.