Brazil’s state-controlled oil giant Petrobras is considering trimming capital spending to $106 billion in its next five-year plan (2026–2030), reflecting a more cautious outlook for oil prices, according to Bloomberg, which quotes people familiar with the discussions. The figure, still under review, represents a 4.5% cut from last year’s $111 billion plan for 2025–2029. The proposal awaits board approval ahead of its scheduled release on November 28.

Petrobras updates its five-year strategy annually, and investors are watching closely since capital spending directly affects the company’s dividend potential. Weaker oil prices have already reduced the likelihood of extraordinary dividends this year. The spending plan also carries political weight: with Brazil’s presidential elections set for next year, Petrobras often faces pressure to boost investments to stimulate the economy and create jobs.

The company recently reported higher-than-expected Q3 capital expenditures, driven by new offshore platform construction, leading some analysts to question whether spending can realistically decline. Still, Jefferies analysts said they see room for a 5–10% reduction in capex, which could sustain annual dividends of $8–9 billion in a “$60–$70 Brent oil world.”

Petrobras’s current plan assumes an $83 per barrel oil price, but management is now considering a more conservative $60–$65 range for the next plan, as Brent crude trades near $63. Despite this revision, the company’s strategy will stay heavily centered on exploration and production, with the bulk of spending earmarked for those areas. Petrobras is also accelerating production to bolster revenues, recently boosting capacity at the Marechal Duque de Caxias platform and stepping up output at Buzios, the world’s largest deepwater oil field.

Of the provisional $106 billion capex, about $91 billion will go to already-approved projects, with the remaining $15 billion allocated to ventures still under financial assessment. Petrobras said last week that it will not alter its $75 billion debt ceiling or its dividend policy, signaling a focus on maintaining balance sheet discipline amid a lower oil-price environment.

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