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Sergio Sacani warns what could cause the price of gasoline in Brazil to skyrocket
Brazil is set to face a decline in oil production in the coming years. Experts and energy sector entities warn of the need to actions immediate measures to prevent the country from becoming an importer of the commodity again, despite currently occupying a prominent position among the world's largest producers. If this happens, the price of gasoline is expected to soar.
Rodolfo Saboia, director of National Agency of Petroleum, Natural Gas and Biofuels (ANP)), highlighted, during Offshore Week 2023, the strategic importance of opening new exploratory frontiers. According to him, without new investments, Brazil's offshore production will face an irreversible decline.
"It is very important that we focus on the strategic importance of opening new exploratory frontiers. We need to keep in mind that it is impossible to imagine renewables supplying everything that comes from fossil fuels today. If we do nothing, the day will come when we will be importers of oil, not exporters.”, said Saboia.
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Worrying projections for the oil and gasoline sector
recent data from Energy Research Company (EPE), linked to the Ministry of Mines and Energy, confirm the warnings.
O Ten-Year Energy Expansion Plan (PDE) 2034 points out that Brazil's oil production will peak in 2030, at 5,3 million barrels per day. However, from then on, a rapid decline is expected, with production falling by almost 1 million barrels per day just four years later.
The PDE 2034 projections are even more pessimistic than those presented in the previous plan, PDE 2032.
The previous estimate predicted a peak in 2029, with 5,4 million barrels per day, and a more gradual decline in subsequent years. This decline directly reflects the reduction in exploratory activities and the discovery of new deposits, a problem that has been worsening in recent years.
According to EPE, the volumes forecast in PDE 2034 are, on average, 1% lower than those estimated in PDE 2032. This apparently small difference reflects the sector's growing difficulty in maintaining production in the face of economic and environmental challenges.
Business Operation
One of the factors complicating the scenario is the long time required for new discoveries to come into operation. PDE 2034 makes it clear that “the resources discovered in the second half of the decade will not come into production in the ten-year horizon".
This means that even if Brazil finds new reserves in unexplored areas, these discoveries will not be enough to reverse the decline until 2034.
According to the study, the interval between the start of exploration and effective production varies from 3 to 5 years for onshore areas and from 7 to 10 years for offshore areas. This makes it essential to start exploratory efforts immediately to mitigate the impact of the drop in future production.
"Due to times that can vary from 3 to 5 years (onshore) or 7 to 10 years (offshore) between the beginning of the exploration phase and the beginning of production, in new frontier areas, there is an immediate need for exploratory efforts to contain the decline in production expected for the coming years.”, highlights PDE 2034.
Risks of external dependence
Failure to act could lead Brazil to become a net importer of oil again. Despite being one of the largest exporters today, the country faces the risk of relying on external markets to meet its energy needs.
The reduction in production does not only affect the trade balance. It also puts the country's energy security at risk, increasing vulnerability to external shocks and fluctuations in the global oil market.
Sérgio Sacani's warning about the price of gasoline
In an interview with the channel AchismosTV, physicist Sérgio Sacani made a worrying warning about the future of the Brazilian economy. He highlighted that, if Brazil NO explore new oil reserves, the price of gasoline could skyrocket, reaching R$40 per liter at the pump. Watch the video below.
In this scenario, the Equatorial Margin emerges as the main bet for the future of oil production in the country, keeping the price of gasoline low.
The region, which stretches between the states of Rio Grande do Norte and Amapá, could hide at least 10 billion barrels of commercially viable oil.
This potential is seen as a great economic opportunity. The government estimates that the exploration of this area could generate a return of more than R$1 trillion for the public coffers.
Petrobras is awaiting authorization from Ibama to begin operations. This license, according to CNN, should be released between March and April of next year.
For experts, this development is crucial for the national economy. However, the issue involves a series of complex issues, such as environmental impacts that may affect the local ecosystem.
The Equatorial Margin region is sensitive and still little studied, which generates apprehension among environmentalists.
The proximity to the mouth of the Amazon River increases the risk of irreversible damage to the environment, which is home to several endangered species and plays a fundamental role in global climate balance.
The debate over the benefits and risks of this exploration intensified in 2023. During this period, Petrobras requested licenses from Ibama to drill in the area, but the agency denied it, pointing out the lack of adequate studies on the environmental impacts.
The decision generated a direct confrontation with the company and reignited the discussion about how Brazil should reconcile economic development with environmental preservation.
Bus, brother! Public transport, brothers, would solve many problems in our country!!
As always, when the country has the chance to improve, it ends up going backwards…..
HERE IS BRAZIL !!!!!!!
Did Saudi Arabia, Iran, Iraq, UAE do an impact study? I'm sure they didn't in Russia... Too much bureaucracy leads to this... Delay... The oil is already there... And what has an impact is the encouragement of the use of oil mixed with biofuels... IBAMA is one-eyed...