Coronavirus: in order to face the drop in demand without strangling fuel storage capacity in the country, Petrobras reduced the level of utilization of its refineries to 60 percent. Petrobras reported last night (23) that it has 261 employees infected with the coronavirus.

Read also

• High school and higher education vacancies for logistics and industrial professionals, today April 23
• Job openings in Macaé for Technicians and Engineers at the oil multinational Weatherford today
• Open selection process for Occupational Safety professionals at Companhia Brasileira de Serviços de Infraestrutura

According to UBS bank analysts, Petrobras stated that there is no need to stop the refineries due to the drop in demand. “Roberto Castello Branco pointed out that the current level [of utilization] is sufficient to maintain balance in inventories”.

Petrobras states that "some refineries are operating at minimum load, ensuring the operation of the unit safely" and that "There are no refineries stopped".

To avoid bottlenecks in tanking capacity, Petrobras reduced oil production to 2,07 million barrels per day in April. The state-owned company did not inform the level of use of its storage infrastructure.

Data from the National Agency of Petroleum, Gas and Biofuels – ANP, report that Brazil has 2.030 tanks for storing oil, gas and biofuels. This structure holds 34 million barrels of oil and 50 million barrels of derivatives, excluding cooking gas.

Currently, the challenge for the oil sector is the high use of capacity to store the product amid the abrupt drop in consumption, for example in the United States, the level of capacity utilization rose from 46% in early 2020 to 60% in the last day 17.

In the last Monday, and without having anyone to sell to or where to store the oil, investors rushed to get rid of contracts with delivery of the product scheduled for next month, leading the WTI price to close at minus 37,63 dollars, which is equivalent to an average of 199 reais per barrel – in practice, buyers paid to not receive the oil.

The 24 percent drop in the price of Brent oil on Tuesday (21) reinforces that demand is weak worldwide. Yesterday, the price recovered, rising 6,3%, to 20,56 dollars (111 reais) per barrel. Even so, the scenario worries the oil companies, which have already announced a series of measures to face the crisis, such as suspension of investments and cost cuts.