The five biggest Western oil producers - Exxon Mobil Corp,
Chevron Corp., Shell PLC, TotalEnergies and BP - posted record cash distributions
to shareholders in recent days of between $4 billion and $7.6 billion. But none
came close to Petrobras's $17 billion payout.
Brazil's government, which controls the producer with a
majority of its voting shares, last month asked Petrobras and other
state-controlled companies to increase dividends to finance extra federal
spending.
The cry for help came as the government of President Jair
Bolsonaro, which later this year faces a tough reelection battle, last month
bypassed a constitutional spending cap to finance a massive cash transfer
program popular among low-income voters.
Petrobras will distribute about 60% more to shareholders
than its $10.5 billion (54.33 billion reais) profit. Critics said the huge
payout will lead to underinvestment in the business.
Petrobras' dividends were less than at Saudi Arabia's
state-controlled Saudi Aramco, the world's largest oil company, which produces
13 million barrels of oil equivalent per day (boed), almost five times more
than Petrobras.
Aramco has been distributing $18.76 billion to shareholders
per quarter. Its next dividend will be disclosed on Aug. 14.
U.S. producer Exxon, which posted the highest quarterly
profit of the five majors, spent $7.6 billion on shareholder distributions.
Bolsonaro is trying to boost his re-election chances by
ramming through short-term spending measures, critics say. Polls show he is
lagging leftist former President Luiz Inacio Lula da Silva. Dividend payments
will be made by Petrobras before the first round of voting, scheduled for Oct.
2.
Petrobras said higher oil prices and assets sales allowed
for the extra payment, and did not compromise planned investments. The company
is in a comfortable cash situation and is able to retain between $8-10 billion
in cash this year, it said. Petrobras reaffirmed its commitment to distribute
at least 60% of its free cash flow to investors.
"The extraordinary dividend payment proved to be the
best allocation of the company's cash," Petrobras said in a statement.
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