Petrobras

The place is too sacred and we cannot do Lula, no, no, it's safe.

I will also hear Petrobras.

I will listen to the investors.

They say it's safe.

but not the way this was done.

And in particular, mention this businessman and this company.

Betancourt.

Betancourt.

gave some of these contracts to people like Betancourt.

But now, because basically they are opening almost every single field to partnership with private companies, some very well-established, respected companies like Chevron or ENI or Repsol, some that are clearly not the type of operators that you would imagine that will win in an open bidding.

And the fact is that today, Only 10% of Venezuela's production is being run solely by the national oil company.

The concern I have is that this reminds me a lot of the privatization in Russia.

It's down about 17% in total.

You've got Petrobras is down about 15%.

You have basically the real, which is the currency, is down about 8%.

You have bond prices up.

In fact, I'm not so sure.

It's unclear.

Comparing the two, of course, huge differences, in particular with the role of Petrobras, I would say.

Since you mentioned Petrobras, let's do that.

They owned about 69% from an acquisition like back in the early 1980s.

But APCO had been in Argentina since the late 1960s and they held like 40% of the Andre Lomas concessions in Neocaine alongside at the time Petrobras.

And then when Williams spun off its E&P business, as you probably know, can remember as WPX at the end of 2011, APCO went with it.

They'd already flowed oil from Vaca Muerta, from vertical wells, but the conclusion was, and probably rightly so at the time, that it would take horizontal wells.

And, yeah, you can just see the run-up to the election was pretty massive.

Had some really large moves and some of the obvious names like EWZ, the Brazilian ETF, Petrobras and some others.

And, yeah, for the King of the Wire and he lost, yeah, some will argue, legitimacy but that doesn't really matter now what matters is um it's kind of assessing like what's changed and i i'm still bullish brazil i don't i think this is an overreaction here because he what's now been priced and for anyone that hasn't like what i'm looking at now ewc it's down 20 percent Petrobras took a similar smashing.

Some that I concentrate on, even the exchange, the B3SA, it's down like 40%.

Granted, it's bounced pretty hard, but just an absolute enormous smashing for a day.

The only names that have been really working for me are some of the Chinese oil companies.

I'm a massive fan of China's National Offshore Oil Corporation.

So someone joked the other day, especially after just taking a hit on Petrobras, that it's nice here because you don't have election risk.

But if you want to participate at the big boy table for politics, then pulling off shenanigans like this, I don't think is going to end up very well.

So What I think will happen moving forwards is that if you are looking at commodity companies in Brazil, so Petrobras is the one that springs to mind automatically.

If you're looking at companies like that, because of the energy play and because of how that's all going to work out moving forwards, I do still think that a company like that is probably going to be quite strong.

Whereas whether it's maybe the banking sector could be strong and I don't know.

But I wanted to start there because there's going to be a lot of opportunities in Brazil.

And I do think the energy and commodity space are going to present good opportunities.

And as I said, Petrobras, I don't have a position in it.

Neither do I have a position in Pemex, you know, over here in Mexico.