Coronavirus curtails gas demand in Brazil: How is Petrobras managing balancing and force majeures?

As part of coronavirus effects, gas demand in Brazil crashed to record levels. Commercial and industrial end-users claims of force majeure to local distribution companies started a chain reaction across the gas value chain in Brazil. Petrobras, as the sole gas supplier, is absorbing some and distributing other losses. Besides, we see Petrobras exercising its flexibility across its upstream, gas and power portfolios to manage crash in end-user gas demand and preserving core pre-salt oil production. The analysis of this crisis provides insights into operational measures in oversupply scenarios, which are likely in the future as pre-salt associated gas will continue growing in Brazil. In this report: 1. The impact of coronavirus in Brazil’s gas demand over March and early April by sector. 2. What actions has Petrobras taken to manage both the demand and supply sides? 3. What are the lessons can the Brazilian gas industry learn from the management of this crisis?