Petrobras returns to global debt markets with new 5- and 10-year bonds of up to $2 billion

By Brazil Stock Guide – Petróleo Brasileiro S.A. – Petrobras (B3: PETR4; NYSE: PBR) returns to global debt markets with a new international bond issuance through its wholly owned subsidiary Petrobras Global Finance B.V. (PGF). The company plans to raise up to $2 billion in 5- and 10-year notes, offering yields of 5.125% and 6.250% respectively. Investor orders have already topped $7 billion, according to market sources.

Moody’s Investors Service rated the new bonds Ba1, in line with Petrobras’ corporate family rating, and kept the outlook stable, consistent with Brazil’s sovereign rating. The agency said default risk remains low, backed by solid financial metrics, limited reliance on domestic funding, modest foreign-exchange exposure, and the fact that roughly 30% of sales come from exports.

“Operational and financial discipline is expected to continue supporting cash generation, helping to preserve the company’s capital structure,” Moody’s said.

Debt profile and cash generation

As of June 2025, Petrobras reported gross debt of $68.1 billion, with expectations to end the year at $65 billion. The company held $9.5 billion in cash. Moody’s projects $32 billion in cash flow in 2025, more than enough to cover annual debt maturities of $1.8 billion to $2.2 billion and capital expenditures of about $23 billion, keeping debt under $65 billion.

The offering is part of Petrobras’ liability management strategy to extend maturities and diversify funding sources. While Moody’s highlighted government influence as a constraint on its rating, it also noted that stronger sovereign metrics or reduced political interference could lead to an upgrade. Conversely, weaker performance, governance risks or a sovereign downgrade could pressure ratings.

Lead managers

The deal is being led by BBVA Securities Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Itaú BBA USA Securities Inc., Santander US Capital Markets LLC and UBS Investment Bank. Petrobras said net proceeds will be used for general corporate purposes.