Dallas, Texas 12/23/2013 (FINANCIALSTRENDS) – The recent decline in the share price of Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR) is seen as a possible short covering made by many trading houses because if we talk about the company’s portfolio management it is excellent. The recent price hike done by the company is considered as a positive development and the company is also adapting to a new pricing strategy that is going to eliminate the higher fuel subsidies. The entire story was not completely cleared and many industry analysts were left little confused.
This confusion is also seen as the main cause of the dip in the share price value. The company is planning to increase the diesel price by almost 8% and gasoline price by almost 4% and wish to make these prices at par with the international markets. It is a company that has large amount of oil reserves in Brazil and offers its services in the Brazil.
The recent discoveries announced by Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR)
The recent discoveries made by the company include presence of oil and gas in the extension well, 3-BRSA-1194-SES which is also known as Moita Bonita-1. This is actually an ultra-deep water well which is located in the Sergipe-Alagoas Basin, in the Moita Bonita area.
Few days earlier Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR) also announced the discovery on the concession BM-POT-17 which is in Rio Grande do Norte. All these discoveries and the recent price hike seems to be working pretty well in the company’s favor and many trade analysts are maintaining a strong buy and hold rating on this stock for better returns in the future. However the main cause of the concern is its declining production capacity and the company is trying hard to upgrade its infrastructure for increase in the overall output.