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Petrobras could lose up to US$350 million per year if Trump taxes Brazilian oil, but the industry giant has tricks up its sleeve to get around the US move and maintain its billion-dollar profits!
If there's one thing we've already understood about Donald Trump, it's that he loves using tariffs as a negotiating weapon. It was the same with steel, it was the same with aluminum... and now people have started to speculate: what if he decides to impose a tax on Brazilian oil and oil products? Would Petrobras feel the impact? The answer may be less frightening than it seems.
Trump's Tariff History and Strategy
Since his first term, Trump has been playing the same game: he imposes tariffs here, threatens them there, and waits for countries to come to the negotiating table. It worked (more or less) with Mexico, Canada, and even China. In some cases, things got ugly, with tariffs of 25% on certain products and 10% on the energy sector, just to give you an idea.
His reasoning is simple: make foreign products more expensive to give American industry a boost. But would this have a huge impact on Petrobras?
The real impact on Petrobras
Well, now comes the part that may surprise a lot of people: the impact would be small. Petrobras sells only 2,5% of its production to the US, meaning that even if Trump decides to tax Brazilian oil, the company would not feel the impact as much.
Let's look at the numbers: depending on the tariff, Petrobras could lose between US$250 and 350 million per year. Does that seem like a lot of money? Of course. But when you put that side by side with the projected EBITDA of R$240 billion for 2025, it becomes obvious that this impact does not even reach 1% of the operation.
How can Petrobras react?
Now, let's say that Brazilian oil become less competitive in the US. What can Petrobras do? Well, there is no shortage of options.
The first and most obvious one is to redirect sales to other markets. Europe and Asia are always on the lookout for reliable suppliers, and Brazil already has good trade relations with countries like China and India. If the US closes one door, the rest of the world has a lot of windows open.
Another alternative is to adjust the commercial strategy, focusing on buyers who pay a better price or have lower logistics costs. Ultimately, those who have quality oil always find a way to sell.
Most affected sectors within the company
According to InfoMoney, Petrobras works in three main areas:
- Exploration and production – the company’s cash cow.
- Refining, transportation and derivatives – which takes care of processing and distribution.
- Energy – a smaller sector, but one that also counts.
If the tax is imposed, the exploration and production sector will be the ones that will feel the brunt of the impact, since exports are part of this sector. But, in general, Petrobras does not depend on the US to make a profit. And that is a huge advantage.
The US has never been trustworthy. The rest of the world is seen as a servant, a supplier of cheap labor. Brazil should analyze, as I believe it is already doing, all its business with the US and seek out other business partners. And we Brazilians, patriots, should do as the Canadian citizen did: we will not consume any North American products.