By Jeffrey T. Lewis

 

SAO PAULO--Brazilian oil producer Petroleo Brasileiro SA, or Petrobras, said Wednesday it will reduce output by another 100,000 barrels per day amid a drop in demand, bringing the total cut to production to 200,000 barrels per day.

The Rio de Janeiro-based company, which last week announced a production cut of 100,000 barrels per day, said the duration of the reduction, along with potential increases or decreases, will be evaluated regularly.

Petrobras is also adjusting production at its refineries and is taking a series of measures to cut personnel costs by an additional 700 million reais ($134 million). From 10% to 30% of salary payments to some managers will be postponed, and the workday of around 21,000 employees will be cut to six hours from eight hours, the company said.

Petrobras produced a record 3.025 million barrels of oil equivalent per day in the fourth quarter and had a production target for this year of 2.7 million barrels of oil equivalent per day, with a variation of 2.5% in either direction depending on market conditions.

Social distancing and quarantine measures around the world have slashed demand for fuels. Last week Goldman Sachs estimated that demand for oil will fall by 18.7 million barrels per day in April.

 

Write to Jeffrey T. Lewis at jeffrey.lewis@wsj.com

 

(END) Dow Jones Newswires

April 01, 2020 11:48 ET (15:48 GMT)

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