Faced with mounting debt-service costs, Brazilian state-run oil company Petrobras on Tuesday announced steep cuts in its current multi-year capital investment budget. During the period 2015 through 2019, Petrobras will invest $98.4 billion, down $32 billion from the company’s original projections. The company also reduced its production target for 2020 from the original 2.8 million barrels per day of crude oil to 2.7 million. One reason for cutting the capital investment budget is rising debt-service costs because of a steep depreciation of the Brazilian Real against the U.S. dollar. Another reason is declining global oil prices. The company maintained its plan to sell $15.1 billion in assets by 2019.
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