Offshore Strike Continues- Platforms Shutdown

Published at 01:02PM - 10/11/15

The nationwide strike by Brazilian offshore oil and gas workers continues into its second week after negotiations between unions and operators, Petrobras, failed.

The strike action originally started in Sunday 1st November, by workers of state owned oil and gas  company Petrobras, in protest to cuts and asset sales by the firm.

The strike is already the biggest the South American nation has seen for over twenty years, and has shut down much of the countries oil and gas infrastructure.

FUP Talks

Talks were held Monday (9th Nov) between Brazil’s offshore oil and gas workers union FUP and state run Petrobras.

The FUP asked of an 18% pay rise for its members and gave Petrobras demands to stop asset sales and planned budget cuts mounting to around US$100 billion.

In a statement, the FUP said that their demands were “in defence of national sovereignty and that the company goes back to being the impulse for development of the country,”

Petrobras, who’s debts amount to over US$130 billion- the largest in the global oil and gas industry, have indicated that it has little room to move.

Slump In Production

According to the FUP, the strike has now spread to 49 offshore oil and gas platforms.  Last week, the FUP said the number of platforms affected had reached 45, of which, 25 had been shut down completely, 8 producing with restrictions, whilst the remaining assets had been taken over by Petrobras’ contingency teams.

No further details has been given as the the production state of the latest figure of 49. The strike has also shutdown 11 onshore refineries.

According to Petrobras, this has reduced their daily production by 115,000 barrels of oil per day, however analysts put the figure much closer to towards the FUP’s quotes of around 400,000 barrels of oil per day.

Many analysts have now made comments as to whether Brazil will start to face domestic shortages of fuel if the strike action continues much longer.

Further Talks

Both parties are set to meet at the negotiating table again Tuesday (10th Nov), to try and hammer out a solution, although with debts of US$130 billon to pay off, and either side currently unwilling to give ground, the strike seems set to carry on.