Brazilian Oil Worker Strike Halts Refineries and Rigs

The 24-hour strike by called by Brazilian oil workers over pay demands stopped operations at 10 out of 11 Petrobras refineries and at least 23 rigs in the country's main oil region of Campos on Thursday, trade union officials said. "The strike started at midnight and will go on for 24 hours. As far as we know, the adherence is practically total, but we still have precise data only from the Campos basin," said Antonio Carrara, a director of the Oil Workers Federation, adding more strike action may come if demands are not met. Officials with Petrobras, the only oil producer and the biggest refiner by far in Latin America's largest country, had no comment but the press service said there would be a statement later in the day.

Campos Basin accounts for about 80 percent of Brazil's total oil output, now standing at around 1.5 million barrels per day. Skeleton teams were working on the rigs maintaining minimum production levels and safety norms.

Petrobras oil workers are protesting against the smaller share of profits they are getting from the state-owned company, which has been posting record profits in the past few years. Unions said the nationwide strike should affect 34,000 workers in the sector and slash output in the Campos basin by at least 40 percent. The last nationwide strike of Petrobras workers in October 2001 lasted 5 days and seriously affected national output, making Brazil import more oil and hitting the country's fragile trade balance.

Now unions said the strike would not jeopardize national supply, but made clear it was an act of warning. "We will end this strike now and then talk to the company. If they remain defiant, we do not rule out another strike which may be longer," Carrara said. "So far, we had no response from the company."

In a 2001 profit sharing program, Petrobras paid its workers 11 percent of the 2.5 billion reais ($1.1 billion) in dividends it disbursed to shareholders that year. But this year, the company was only planning to pay out to workers 7 percent of the 3.5 billion reais in dividends due to be disbursed to shareholders May 3.