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Can Refining Strength Drive Petrobras' Earnings Growth?
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Key Takeaways
Petrobras lifted refined output to 1,816 Mbpd in Q1 2026 as utilization reached 95%.
PBR's March utilization hit 97.4%, the highest monthly level since December 2014.
Petrobras cut LPG imports to 26 Mbpd and signed a Vale deal for S-10 diesel with 15% biodiesel.
The refining business of Petroleo Brasileiro S.A., or Petrobras (PBR - Free Report) ), had a strong first quarter, and the main reason was simple: its refineries ran harder and produced more fuel. In the first quarter of 2026, the company produced 1,816 thousand barrels per day (Mbpd) of refined products, up 6.7% from the previous quarter. Its refinery utilization rate reached 95%, and in March it climbed to 97.4%, the highest monthly level since December 2014. This shows that Petrobras is getting more out of its existing refining assets at a time when fuel demand and supply security remain important.
The stronger performance came from making more of the products that matter most to customers and margins. Diesel, gasoline and jet fuel made up 68% of total oil products output in the quarter. The largest integrated energy firm in Brazil also reached a monthly record of 512 Mbpd of S-10 diesel production in March. Since S-10 diesel is a cleaner, high-demand fuel, producing more of it can help Petrobras improve its product mix and support downstream profitability. The higher use of pre-salt oil in refining also points to better flexibility in turning domestic crude into higher-value products.
This is important beyond just quarterly numbers. Higher refinery output helped Petrobras reduce its need for imports, including LPG imports, which fell to 26 Mbpd. The company also signed a deal with mining behemoth Vale to supply S-10 diesel containing 15% biodiesel, showing how its refining business can support both customer relationships and lower-carbon fuel offerings. If Petrobras can keep utilization high while controlling costs, the downstream business could become a more reliable earnings driver.
Petrobras’ stronger refining performance is not happening in isolation. A look at U.S. energy giants Chevron (CVX - Free Report) and ExxonMobil (XOM - Free Report) shows that downstream strength remains an important earnings lever for integrated energy majors, especially when higher utilization, better margins and product optimization come together.
Downstream Momentum Extends Beyond Petrobras
Chevron’s downstream had a mixed first quarter, but its refining assets showed clear operating strength. U.S. downstream earnings rose from a year earlier as margins improved, and U.S. refinery crude inputs increased 4% to 1,054 Mbpd, helped by Pasadena’s Light Tight Oil project. Chevron also achieved record U.S. crude throughput in March. For Chevron, international downstream weakness came from timing effects and higher costs.
ExxonMobil’s downstream performance was stronger on an underlying basis. Energy Products earnings, excluding identified items and timing effects, reached $2.8 billion, up $1.9 billion year over year, supported by better refining margins, trading and optimization gains, and cost savings. ExxonMobil also benefited from high U.S. Gulf Coast refinery utilization, although maintenance and Middle East disruptions reduced volumes. For ExxonMobil, downstream remained a key earnings support.
The Zacks Rundown on PBR
Shares of PBR have gained some 68% over the past year, outperforming the industry’s growth.
Image Source: Zacks Investment Research
Petrobras currently has an average brokerage recommendation (ABR) of 1.61 on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by nine brokerage firms.
Image Source: Zacks Investment Research
See how the Zacks Consensus Estimate for PBR’s earnings has been revised over the past 90 days.
Image Source: Zacks Investment Research
The company currently carries a Zacks Rank #1 (Strong Buy).
View the Zacks #1 Rank List
Image: Bigstock
Can Refining Strength Drive Petrobras' Earnings Growth?
Key Takeaways
The refining business of Petroleo Brasileiro S.A., or Petrobras (PBR - Free Report) ), had a strong first quarter, and the main reason was simple: its refineries ran harder and produced more fuel. In the first quarter of 2026, the company produced 1,816 thousand barrels per day (Mbpd) of refined products, up 6.7% from the previous quarter. Its refinery utilization rate reached 95%, and in March it climbed to 97.4%, the highest monthly level since December 2014. This shows that Petrobras is getting more out of its existing refining assets at a time when fuel demand and supply security remain important.
The stronger performance came from making more of the products that matter most to customers and margins. Diesel, gasoline and jet fuel made up 68% of total oil products output in the quarter. The largest integrated energy firm in Brazil also reached a monthly record of 512 Mbpd of S-10 diesel production in March. Since S-10 diesel is a cleaner, high-demand fuel, producing more of it can help Petrobras improve its product mix and support downstream profitability. The higher use of pre-salt oil in refining also points to better flexibility in turning domestic crude into higher-value products.
This is important beyond just quarterly numbers. Higher refinery output helped Petrobras reduce its need for imports, including LPG imports, which fell to 26 Mbpd. The company also signed a deal with mining behemoth Vale to supply S-10 diesel containing 15% biodiesel, showing how its refining business can support both customer relationships and lower-carbon fuel offerings. If Petrobras can keep utilization high while controlling costs, the downstream business could become a more reliable earnings driver.
Petrobras’ stronger refining performance is not happening in isolation. A look at U.S. energy giants Chevron (CVX - Free Report) and ExxonMobil (XOM - Free Report) shows that downstream strength remains an important earnings lever for integrated energy majors, especially when higher utilization, better margins and product optimization come together.
Downstream Momentum Extends Beyond Petrobras
Chevron’s downstream had a mixed first quarter, but its refining assets showed clear operating strength. U.S. downstream earnings rose from a year earlier as margins improved, and U.S. refinery crude inputs increased 4% to 1,054 Mbpd, helped by Pasadena’s Light Tight Oil project. Chevron also achieved record U.S. crude throughput in March. For Chevron, international downstream weakness came from timing effects and higher costs.
ExxonMobil’s downstream performance was stronger on an underlying basis. Energy Products earnings, excluding identified items and timing effects, reached $2.8 billion, up $1.9 billion year over year, supported by better refining margins, trading and optimization gains, and cost savings. ExxonMobil also benefited from high U.S. Gulf Coast refinery utilization, although maintenance and Middle East disruptions reduced volumes. For ExxonMobil, downstream remained a key earnings support.
The Zacks Rundown on PBR
Shares of PBR have gained some 68% over the past year, outperforming the industry’s growth.
Petrobras currently has an average brokerage recommendation (ABR) of 1.61 on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by nine brokerage firms.
See how the Zacks Consensus Estimate for PBR’s earnings has been revised over the past 90 days.
The company currently carries a Zacks Rank #1 (Strong Buy).
You can see the complete list of today’s Zacks #1 Rank stocks here.