Petrobras: Pricing Lag Effect Drove Soft 1Q26; Patience to be Rewarded Ahead

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Petrobras: Pricing Lag Effect Drove Soft 1Q26; Patience to be Rewarded Ahead

e tailwind from

Unless otherwise noted, all metrics are based on Morgan Stanley ModelWare

higher Brent, driving FCF of $0.8B vs. our $1.9B forecast (although up 63% Q/Q). framework

** = Based on consensus methodology

Dividends of $0.29/ADR (1.4% yield) landed at the bottom of consensus, missing §* ==GAAPConsensusor approximateddata is providedbasedbyonRefinitivGAAP Estimates

the $0.36/ADR average by 20%. MSe was in line with consensus. e = Morgan Stanley Research estimates

Cash Capex of $4.5B provided welcome relief, matching consensus and MSe;

Exhibit 1 : PBR: 1Q26 Essentials

leasing payments also improved, down 7% Q/Q to $2.4B. PBR (US$m) 1Q26a 1Q26e A x E Q/Q Y/Y

Domestic Oil Prod. (Kbbl/d) 2,584 2,584 0.0% 3.2% 16.3%

Gross debt slightly increased to $71B (from $70B in 4Q25) and remained within Revenue 23,519 25,162 -6.5% -0.3% 11.8%

EBITDA, adjusted 11,605 13,348 -13.1% 6.2% 9.1%

the $75B ceiling, while ND/EBITDA slightly declined to 1.3x (from 1.4x in 4Q25). Net Income 6,211 7,128 -12.9% 115.5% 3.3%

Normalized EPADR 0.93 1.11 -16.0% 58.6% -1.9%

Source: Company data, Morgan Stanley Research estimates

Results in a nutshell: adjusted EBITDA of $11.6B (+6.2% Q/Q; +9.1% Y/Y) missed our

estimate by 13% and consensus by 10%. Normalized EPADR of 0.93 was 16% below Earnings Webcast: Tuesday, May 12, at 10:30

our forecast, primarily on softer operating results, partially offset by higher non- AM ET (Portuguese/English) ; Link to the

cash FX gains. We did not adjust EBITDA for the reported $122M export tax charge

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