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Petrobras CEO offers resignation, U.S.-listed shares tumble

In Technology
May 15, 2024

By Rodrigo Viga Gaier

RIO DE JANEIRO (Reuters) – The chief executive of Brazilian state-run oil company Petrobras offered to step down on Tuesday, the company said, sending shares sliding as investors braced for the possibility of more political interference at the firm.

Chief Executive Jean Paul Prates asked the Petrobras board to meet and discuss an early end to his term, the company said in a late Tuesday filing.

New York-listed shares of Petrobras fell over 6% in after-hours trading.

The securities filing came after Brazilian President Luiz Inacio Lula da Silva made the decision to dismiss Prates, two people familiar with the matter said on Tuesday.

Lula is likely to nominate Magda Chambriard, former head of Brazilian oil and gas regulator ANP, as Petrobras’ CEO, the sources said, confirming a report by newspaper O Globo.

Since Prates took over as CEO in January 2023, he has tangled repeatedly with Energy Minister Alexandre Silveira, who openly criticized the company for not doing enough to lower fuel prices or boost Brazil’s economy with investment projects.

Silveira’s criticisms often echoed Lula’s own concerns about Petrobras, which he has said should do more to help the country.

The dispute between Silveira and Prates hit a fever pitch in March, when the company’s board – largely appointed by Silveira – defied Prates and withheld extraordinary dividends that investors expected, weighing heavily on Petrobras shares.

Prates also said he intends to resign from his role on the board of Petrobras after ending his CEO term, according to the company filing.

(Reporting by Rodrigo Viga Gaier in Rio de Janeiro; Additional reporting by Andre Romani in Sao Paulo; Writing by Fabio Teixeira; Editing by Valentine Hilaire, Brad Haynes and Leslie Adler)

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