Petrobras, Brazil's state-run oil company, reported a fourth-quarter profit of $6.39 billion up from $4.6 billion a year earlier primarily due to increased production and higher oil prices. That beat the consensus estimate of almost $5.6 billion The company's full-year profit was $21.1 billion.
While higher oil prices helped boost profits on the oil Petrobras (PBR) exports, the company's ability to take advantage of higher oil prices in its home market of Brazil are muted because the government often pressures the company to keep gasoline and diesel prices lower in an effort to stem inflation.
The company said it does not expect to change this policy in the near future. Brazilian gasoline and diesel fuel sales represent about 50% of Petrobras' revenues, according to the Wall Street Journal. The company was able to reduce lifting and refining costs in the fourth quarter, helping boost its profitability.
Petrobras ended 2010 with average daily net export volume of 82,000 barrels, down from an average of 156,000 barrels exported a day in 2009, the Journal reported. Total cost savings for the year were $300 million.
In January, Petrobras produced 2.662 million barrels of oil equivalent per day. The company is aiming to have daily output of 4 million barrels by 2020.