Why Petrobras is sticking to its upstream roots

Petrobras has emerged stronger from a corruption scandal and a massive pile of debt thanks to much improved governance that allowed better financial decisions, more strict cost and project controls, and an active portfolio management. Coupling this with the highly productive pre-salt fields, Petrobras will be able to provide robust cash flows to its investors during the next two decades. However as the world energy companies face a balancing act between energy transition and provide affordable fossil fuels in a short-term, Petrobras' efforts are mainly limited to control scope 1 and 2 emissions and facing political pressures to change fuel pricing policies. This is an uneasy situation considering that the company's reserves are not as big as other NOCs that are maintaining similar strategies. Petrobras needs to take the advantage of being a leaner and profitable company and establish a more robust energy transition strategy.