OREANDA-NEWS. Foreign oil companies operating in Brazil are awaiting major reforms after president Dilma Rousseff was effectively suspended from office early today, setting the stage for the investiture of vice president Michel Temer.

In a marathon session that stretched almost 20 hours, the 81-member senate voted by 55 to 22 to approve a request to initiate an impeachment trial against Rousseff on allegations of financial maneuvers intended to obfuscate the fragile state of the country's finances ahead of her 2014 re-election bid. She denies any wrongdoing, and she and her supporters call the impeachment campaign a coup.

Temer's ascendancy is widely seen as a first step toward lifting Brazil out of a deep political and economic malaise driven in part by a gargantuan corruption scandal centered on state-controlled oil company Petrobas.

Temer is expected to formally assume the presidency today, after Rousseff receives official notice of the senate's decision. Many analysts say the soft-spoken academic, who is himself among a slew of senior politicians accused of corruption, has a small window to adopt measures necessary for righting the country's finances and attracting investors.

Brazil's GDP is expected to shrink by 3.7pc in 2016, almost the same as last year.

Temer has already assembled a cabinet designed to facilitate the swift adoption of market-oriented economic reforms.

He faces intense opposition from Rousseff's Workers Party (PT), which has led Brazil for the past 13 years.

For the oil industry, the wish list includes a relaxation of strict local content rules that require projects to use locally sources goods and services; elimination of a legal provision that mandates a minimum 30pc operator role for Petrobras in all sub-salt projects; and clearer and more flexible rules for oil transshipment in Brazilian waters.

The senate needed a simple majority to initiate the impeachment trial that requires Rousseff step down for up to 180 days. A definitive removal, which would allow Temer to serve the remainder of her term until 2018, requires a two-thirds vote, which the opposition appears to have.

In October 2014, Rousseff won her second four-year term by a narrow margin and has been fighting off the threat of impeachment ever since. Her removal is the second impeachment in the 31 years since Brazil returned to democracy after a more than two-decade military dictatorship.

Labor unions opposed to Rousseff's removal and the privatization agenda Temer is expected to pursue have threatened to launch a general strike that could hinder the transition government's efforts.

The labor union representing workers in Petrobras' transportation subsidiary Transpetro say it could launch a nation-wide indefinite strike as early as tomorrow, potentially disrupting fuel supplies. Petrobras was not available to comment.

Other oil workers unions have also been threatening a walkout that could impact Petrobras' upstream and downstream activities.