Good morning! The government’s plans for oil reserves it hasn’t discovered yet. The fight for space in the Brazilian airline market. And the expected cuts to Brazil’s benchmark interest rate. Enjoy your read!
Brazil’s yet-to-be-discovered oil fields to be privatized
Since 2004, Brazil has been pleading with the UN to increase its maritime exclusive economic zone from 200 to 350 nautical miles. Last month, the country got its first win, with the UN publishing on its website that Brazil’s continental platform in the South would be increased to exactly those 300 nautical miles—an area of the size of Uruguay. But even before these requests granted, the government already had a plan to privatize the new oil fields it might have the right to exploit within the next two years.
Why it matters. Experts predict that the reserves in the region claimed by Brazil could increase the country’s oil and gas output, today at 15.9bn barrels, by as much as 50%. Government officials have called this region the “pre-salt mirror,” as it would be just as rich as the pre-salt deepwater reserves, which today provide the bulk of Brazil’s oil production. And this is in addition to the presence of minerals...