Brazil oil strike enters second week

Rio de Janeiro, 9 November (Argus) — Brazil's state-controlled Petrobras and labor unions failed to reach an agreement today that would bring an end to an indefinite strike that started on 1 November.

The strike, the longest since a 32-day work action in 1995, has cost Petrobras more than 820,000 bl of crude production and dented the company's downstream operations.

Petrobras has not disclosed the amount of production lost since 6 November, and has declined to comment on the precise impact on its 13 domestic refineries.

The FUP, a federation of oil workers unions, says 49 offshore platforms participating in the strike have cut around 400,000 b/d from Petrobras? domestic output, or around 20pc of the company's pre-strike output.

Brazilian oil regulator ANP says there is currently no fuel shortage risk, but it will take necessary measures should the situation arise.

The unions oppose the oil company?s $58bn asset sales and restructuring plan.

Petrobras has said the plan is necessary to tackle its $130bn debt and restore value to its shareholders.

FUP organizer Jos? Maria Rangel said the federation presented proposed changes to the restructuring plan. A fresh round of labor talks could take place tomorrow.

Petrobras was not immediately available to comment on today?s negotiations.

The oil workers strike and a parallel truckers strike that started in various states throughout Brazil earlier today are putting more pressure on a government austerity plan adopted by embattled president Dilma Rousseff.

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