Petrobras (NYSE: PBR) stock plummeted 7% in intraday trading Wednesday following the sudden dismissal of Jean-Paul Prates, the CEO of the state-controlled oil behemoth.
In a recent press release, Petrobras (PBR) announced the departure of CEO Jean-Paul Prates after a board meeting deliberated on his “early termination.” The Brazilian Ministry of Mines and Energy communicated the appointment of Magda Chambriard, a former energy regulator, as Prates’ successor.
In addition, Petrobras’ Chief Financial and Investor Relations Officer Sergio Caetano Leite has been relieved of his duties. Carlos Alberto Rechelo Neto steps in as the interim CFO.
What’s Behind Petrobras’ Executive Shake-Up?
Prates, who assumed the CEO role in January 2023, becomes the fourth CEO ousted in as many years. The decision to remove Prates reportedly stems from a dispute over dividends with Brazil’s President, Luiz Inacio Lula da Silva.
This conflict emerged when Prates resisted complying with government-appointed board members earlier this year, who sought to withhold the payment of extraordinary dividends. President Lula advocated for Petrobras to reallocate funds from shareholder returns towards investments aimed at job creation and economic growth.
Petrobras (NYSE: PBR) Stock Price Action
The repercussions of the executive reshuffling were keenly felt in Petrobras’ stock performance. PBR stock plunged 6.77% to close at $15.56 on Wednesday, marking a significant decline for the week. Trading activity surged, with 69.55 million shares changing hands, well above the average daily volume of 21.88 million.
Edward Cooke is a financial analyst, freelance writer, and editor. He has six years of experience in financial journalism. He has an in-depth understanding of equities markets, tracking major indices and providing real-time analysis on stock price movements, corporate earnings, and market sentiment.
